Avista & Rite Aid Financial Statements Spring 2024 - Pre-work



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Feb 20, 2024





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Avista Utilities & Rite Aid Financial Statements – Pre-Work 1. How much net income or net loss did Avista Utilities and Rite Aid each make in the most recent year they reported? HINT: be sure to look at the last line of the heading so you are accurate in the numbers you report. Avista was 147,334 for 2021, rite aid was -538,478 for 2021 2. Review Avista and Rite Aid’s current and quick ratios. Why are these ratios the same as each other for Avista but different for Rite Aid? Explain why this makes sense given the type of companies Avista Utilities and Rite Aid are. I think they could be different because avista has a consistent cost of goods and then rite aid on the other hand has different types of inventory. 3. a) Provide the formula for the debt to equity ratio for Rite Aid. b) Then provide the actual numbers you would use to calculate the debt to equity ratio for the fiscal year ending February 26, 2022. Calculate the ratio and verify it matches the value provided on the ratios tab. c) Then describe what the ratio means. a) Total liabilities/total equity= b) 8,429,970/99,033= 85.123 c) It means how much of the company is financed by equity and debt
4. a) Provide the formula for Return on Equity and Net Profit Margin ratios for Avista Utilities. b) Then provide the actual numbers you would use to calculate these two ratios for 2021. Calculate the ratios and verify they match the values provided on the ratios tab. c) Then describe what the ratios mean. a)Return on equity net income/total owners equity: b)147,334/2,154,744; 0.0683 return on equity 5. Review Avistas’ Net Profit Margin ratio across 2019, 2020, and 2021. Describe the trend in the ratio. Using values from the income statement, explain what is causing the trend. The ratio started off decent at 14.62 in 2019, then dipped way down for them into 9.80 in 2020, and then climbing back up to 10.24 in 2021. 6. On each of the income statement and balance sheet tabs, your are provided with each value as a % of revenue. Analyzing these values allows you to look for trends in expenses and compare financial statements across companies. (This is what we did in class when introducing financial statements where we compared a bank to a pharmaceutical company.) Review the %ages of revenue and identify and describe 2 observations about either a trend in expenses or a difference between Avista Utilities and Rite Aid. Rite aid has revenue yes but not as much as avista, avista has lots more revenue across more things.
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