Mohanad almathami

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College of Business Administration

ASSE: 3211 Learning Outcome Assessment II

Web Quest

Dell and Apple in comparison to the industry

Submitted by:

MOHANAD ALMATHAMI

200800809

SUMMER 2012

Introduction
Background Information:
Financial Analysis involves a comparison of a firm’s performance with that of another firm in the same line of business, or the firm’s current performance with that of the industry to identify its strengths and weaknesses in the areas of liquidity, profitability, efficiency and leverage. This task is to compare the financial ratios of Dell, Apple and the computer industry and be able to assess their strengths and weaknesses.

Importance of Financial Analysis:

The information provided by financial analysis is used by;

Financial managers to make financing and investment decisions to maximize shareholder’s value.
Stockholders and creditors to evaluate attractiveness of the firm as an investment by examining its ability to meet its current and expected future financial obligations.

Learning Outcome:

At the end of the task, the user will be able to;

Assess the liquidity of Dell and Apple in comparison to the industry
Assess the profitability of Dell and Apple in comparison to the industry
Assess the efficiency of Dell and Apple in comparison to the industry
Assess risk of Dell and Apple in comparison to the industry
Determine which company is more attractive investment prospect

Task
The user is expected to perform the following task to be able to compare Dell, Apple and the computer industry.
Task 1: Information about the computer industry

Task 2: Company and background information about Dell

Task 3: Company and background information about Apple

Task 4: Meaning of financial ratios and formula

Liquidity Ratio
Profitability Ratio
Efficiency Ratio
Risk or Coverage Ratio

Task 5: Complete the following journals

Journal 1 Industry and Company Information
Journal 2 Summary of Ratios
Journal 3 Summary of Findings

Click here for the copy of the journal #1 (Industry and Company Information)
Click here for the copy of the journal #2 (Summary of Ratios)
Click here for the copy of the journal #3 (Summary of Findings)

Process
Step 1: In your journal # 1, complete the Computer Industry Analysis by providing short but complete information about products, customer base, top line and expenses. Use the following link to answer the questions.
http://www.valueline.com/Stocks/Industry_Report.aspx?id=7178
Step 2: In your journal 1, complete the Company and Background Information for Dell and Apple. Provide short history and product listing. Use the following link to answer the question

http://en.wikipedia.org/wiki/Dell

http://en.wikipedia.org/wiki/Apple_Inc.
Step 3: Read and understand the following financial ratios and formula, by clicking the link below.

Liquidity Ratio
Profitability Ratio
Efficiency Ratio
Risk or Coverage Ratio

http://www.netmba.com/finance/financial/ratios/
Step 4: In your journal 2, complete the following ratios for Dell and Apple and the Computer Industry

For Apple Inc. follow the following link

http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=FinancialCondition

http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=ProfitMargins

http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=PriceRatios

http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=GrowthRates

http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=InvestmentReturns

http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=ManagementEfficiency

For Dell Inc. follow the following link

http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=FinancialCondition

http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=ProfitMargins

http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=PriceRatios

http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=GrowthRates

http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=InvestmentReturns

http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=ManagementEfficiency

Step 5: In your journal #3, assess each company’s liquidity, profitability, efficiency and risk using the information from journal #2.
You have completed the task!

Resources
Journal #1-Industry and Company Information
Journal #2-Summary of Ratios
Journal #3-Summary of Findings
http://www.valueline.com/Stocks/Industry_Report.aspx?id=7178
http://en.wikipedia.org/wiki/Dell
http://en.wikipedia.org/wiki/Apple_Inc.
http://www.netmba.com/finance/financial/ratios/
http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=FinancialCondition
http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=ProfitMargins
http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=PriceRatios
http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=GrowthRates
http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=InvestmentReturns
http://investing.money.msn.com/investments/key-ratios?symbol=AAPL&page=ManagementEfficiency
http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=FinancialCondition
http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=ProfitMargins
http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=PriceRatios
http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=GrowthRates
http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=InvestmentReturns
http://investing.money.msn.com/investments/key-ratios?symbol=dell&page=ManagementEfficiency

Evaluation

3

2

1

Points

Industry and Company Information

Correct responses

Complete sentences

Grammatically correct

Responses are not totally correct

Sentences are short

Some grammatical errors

Does not answer all questions.

Has quite a few sentence and grammatical errors.

Journal Pages

worksheet areas are correctly completed

worksheets are not fully completed, but are most of the way done

worksheets are incomplete but some attempt was made

Ratio Analysis

Creative and critical analysis

Some originality

Lacks originality

Decision-making

Correct Analysis

Analysis is not totally correct

Analysis is somewhat different

TOTAL POINTS

Conclusion

On the Task:

In performing the task the user obtains an understanding about the computer industry; its market, future outlook and growth prospect. The user obtains information about Dell and Apple, their respective history, market share, financial condition, operating performance. The user learns about the liquidity, profitability, efficiency and risk of both companies in comparison with the industry. The user also was able to assess each company’s individual strengths and weaknesses. At the end, the user was able to determine which company provides better investment opportunity.

On the Web Quest Project:

This project is fun and educational at the same time. It combines my knowledge in accounting and information technology. This system is a good platform to learn accounting utilizing the internet as a resource. The method is very detailed and specific and the users will learn a lot from the vast information provided by the internet. It is a creative and innovative way to study and learn.

JOURNAL #1: INDUSTRY AND COMPANY INFORMATION

Computer Industry Analysis

Products _________________________________________________

_________________________________________________________

Customer Base____________________________________________

_________________________________________________________

Top Line__________________________________________________

_________________________________________________________

Expenses_________________________________________________

_________________________________________________________

Company and Background Information: DELL and APPLE


Type
Ticker Symbol
Industry
Date Founded
Founder(s)
Headquarters
Area served
Key people-CEO
Products
Revenue
Operating income
Net income
Total assets
Total equity
Employees
Subsidiaries
Website

Short History of Dell and Apple_______________________________

_________________________________________________________

Products Listing of Dell and Apple_____________________________

_________________________________________________________

JOURNAL #2: Summary of Ratios

Financial Condition	Dell	Apple	Industry
Current Ratio
Quick Ratio
Debt/Equity Ratio
Interest Coverage
Leverage Ratio

Profit Margins %	Dell	Apple	Industry
Gross Margin
Net Profit Margin
5-Yr Gross Margin (5-Year Avg.)
5-Yr Net Profit Margin (5-Year Avg.)

Price Ratios	Dell	Apple	Industry
Current P/E Ratio
Price/Book Value

Growth Rates %	Dell	Apple	Industry
Sales (Qtr vs. year ago qtr)
Net Income (Qtr vs. year ago qtr)
Sales (5-Year Annual Avg.)
Net Income (5-Year Annual Avg.)

Investment Returns %	Dell	Apple	Industry
Return On Equity
Return On Assets
Return On Capital
Return On Equity (5-Year Avg.)
Return On Assets (5-Year Avg.)
Return On Capital (5-Year Avg.)

Management Efficiency	Dell	Apple	Industry
Receivable Turnover
Inventory Turnover
Asset Turnover

JOURNAL #3: SUMMARY OF FINDINGS

STRENGTHS AND WEAKNESSES

Assess the liquidity of Dell and Apple in comparison to the industry

________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Assess the profitability of Dell and Apple in comparison to the industry

Assess the efficiency of Dell and Apple in comparison to the industry

Assess risk of Dell and Apple in comparison to the industry

Determine which company is more attractive investment prospect? Why?

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