Financial Performance for SAC 2010 & 2011 Assignment

Financial Performance for SAC 2010 & 2011 - appellative ExampleAt the end, recommendations are presented for Sparklin Automotive Company on the basis of performance evaluation presented in the report.Ratio abridgment refers to the financial analysis tool through which financial analysts carry out the analysis of a companys financial performance by conducting a quantitative analysis. For the purpose of find out different ratios for the company, its financial statements are considered, which include comparative information, i.e. information pertaining to more than one financial family (Albrecht, Stice, & Stice, 2008 Eugene F. Brigham, 2012 Needles & Powers, 2010).Current ratio is a measure of liquidity position of a company, which determines the amount of liquid assets possess by a company in comparison with the amounts owed by it in short run. The ratio is resolved by dividing current assets with current liabilities of the company (Needles & Powers, 2010).The debt to equity ratio for a company shows that how far a companys finance is obtained through borrowing with reference to the summation equity of the company. This ratio, as the micturate suggests, is refractory by dividing the total debt of the company with total equity (Needles & Powers, 2010).The inventory turnover ratio shows the frequence with which a companys inventory is sold over a period of time. The ratio is determined by dividing the total sales revenue with the average inventory level or ending inventory, as the case may be (Needles & Powers, 2010).This ratio signifies the efficiency of a company with respect to the collection of its amounts owed to debtors. When accounts receivable turnover is high, it is considered favorable because the company is able to maintain a lower level of receivables with respect to total revenues earned on credit. The ratio is determined by dividing the total revenues earned with accounts receivables (Needles & Powers, 2010).The gross margin voice is a ratio which shows gross margin as a