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accounting

The following text mentions that financial statement analysis has two major components: a trend analysis, where we evaluate changes in key ratios over time, and a peer analysis, where we compare financial ratios with firms that are in the same industry and/or line of business. We will do both of these types of analysis in this problem.

Through the Morningstar website, you can find the firm's financials (Income Statement, Balance Sheet, and Cash Flow) on an annual or quarterly basis for the five most recent time periods. In addition, the site contains Key Ratios (Profitability, Growth, Cash Flow, Financial Health, and Efficiency) for 10 years. We will use the Key Ratios on this site to conduct the firm's trend analysis. (At the bottom of the screen you will see that you can click "Glossary" to find definitions for the different ratios. For example, Morningstar's Financial Leverage ratio is the same as the Equity multiplier that we use in the textbook.) On the Google Finance site, you can find the firm's financial statements for the four most recent years or the five most recent quarters and key financial data for related companies for the most recent year or quarter. We will use the related companies' annual data to conduct the firm's peer analysis. Notice that when you go to the "Related Companies" screen, you can "add or remove columns." Click on that phrase, and you can check which peer data items you'd like to show on the computer screen. Also, once you have chosen the data, you can click on a term, and the companies will be ranked in either ascending or descending order for the specific term selected.

Looking at Morningstar’s Profitability ratios, what has happened to HP’s profit margin (net margin %) over the past 10 years? What has happened to its return on assets (ROA) and return on equity (ROE) over the past 10 years?

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psychology

Interview a younger sibling, cousin, or friend (5 years old or younger). Use what you have learned about the development of language to describe that child’s use of language.

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accounting

For the past two editions of the textbook, this case has followed the financial condition of Detroit, Michigan. As this text goes to print, Detroit has emerged from bankruptcy and in accordance with Michigan Public Act 181 of 2014, it is currently monitored by the Detroit Financial Review Commission for compliance with the Plan of Adjustment. In the 2016 CAFR, Detroit indicates that its debt rating has actually been upgraded from the time the last edition of the textbook was published, when its debt had received a junk bond rating of Caa2 from Moody’s.

Currently the debt is rated as B2, which puts the uninsured debt in the below investment grade category. The audit of the 2015–2016 financial reports, conducted by Plante and Moran, provided Detroit with an unmodified opinion. As discussed in the MD&A, Detroit is making progress toward a sounder financial footing. Bonded debt decreased by $5.8 billion in the fiscal year as a result of eliminated, restructured, and new debt associated with the bankruptcy restructuring.

Use the information from the table of selected 10-year trend data and the Detroit CAFR report for the year ended June 30, 2016 to complete this assignment.

	Selected 10-Year Trend Data from Detrolt's CAFRs
Measure	2016	2015	2014	2013	2012	2011	2010	2009	2008	2007
Cash and cash equivalents	$595	$652	$534	$82	$82	$123	$81	$116	$268	$59
Current liabilities	$343	$384	$747	$521	$1,038	$818	$871	$823	$858	$726
General Fund balances	$501	$438	$53	($73)	($269)	($148)	($91)	($267)	($142)	($91)
Governmental fund total revenues	$1,353	$1,378	$1,422	$1,370	$1,524	$1,712	$1,630	$1,748	$1,773	$1,910
Governmental fund total expenditures	$1,146	$1,506	$1,326	$1,311	$1,586	$1,711	$1,665	$1,843	$1,908	$1,870
Debt per capita	$2,114	$2,229	$3,041	$3,023	$2,961	$3,089	$2,301	$2,074	$2,195	$2,137
Legal debt limit used	34.49%	56.86%	65.17%	66.69%	92.65%	84.82%	75.46%	59.10%	54.50%	49.67%
Debt service/operating expenditures	13.53%	18.30%	19.28%	20.19%	15.10%	13.70%	13.39%	14.41%	13.97%	13.00%