5-1 Power BI: Visualization of Financial Performance MBA-620-Q4849 xxxx
Summary
A visual presentation and analysis have been completed to help compare the performance of the
companies that are being considered in the acquisition. To measure the financial performance of
Company A and Company B both the balance sheets and income statements for 2017 – 2019
were analyzed (snhu.edu, 2022).
Company A
When reviewing the balance sheet for Company A, total assets in 2017 and 2018 remained
consistent. There were slight changes in inventory over the three-year period. However, in 2019,
there is a decline in total assets by $17,896; this was primarily driven by a decrease in cash from
2018 to 2019. Total liabilities between 2017 and 2018 remained consistent, with a significant
decline in 2019 of $17,895. Debt decreased in 2019 by $20,000 over prior year periods. There
were also slight increases in retained earnings ($2,380) and shareholder equity ($2380).
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5-1 Power BI: Visualization of Financial Performance MBA-620-Q4849 xxxx
When reviewing the Income Statement for Company A, there is a slight increase in revenue year
over year, by approximately $800. COGs increased by $3,608 from 2017 to 2018 and decreased
to $2,719 in 2019. The increase in COGs is impacting the overall gross profit in 2018 ($9,786),
however, we can see improvements in 2019, when gross profit increased to $13,324. Because of
the increase in COGs in 2018, there was no positive net earnings in that year. Net earnings did
increase in 2019; with net earnings being higher than 2017.
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5-1 Power BI: Visualization of Financial Performance MBA-620-Q4849 xxxx
Company B
When reviewing the Balance Sheet, total assets remained consistent between 2017 and 2018,
however there was a decrease of $9,935 between 2018 and 2019. This is primarily driven by the
decrease ($9,970) in 2019. Total liabilities also decreased by $10,014 between 2018 and 2019;
primarily driven by a $10,000 decrease in debt. Cash appears to have been used to decrease debt,
to help offset the increasing COGs.
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5-1 Power BI: Visualization of Financial Performance MBA-620-Q4849 xxxx
In reviewing the Income Statement, we can determine that revenue declined in 2018 when
compared to the three-year trend. COGs increased by over $3,000 from 2017 to 2018 and
remained at approximately $18,000 for both 2018 and 2019. Overall gross profit decline by
$4,700 from 2017 to 2018 and shows a slight increase into 2019 of $1,049. EBIDTA and Net
earnings took a significant hit in 2018. 2019 showed some improvements, however not when
compared to 2017. Total expenses year over year remained consistent. The increase in COGs
without the associated increase in revenue is causing the impact to EBITDA and net earnings.
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5-1 Power BI: Visualization of Financial Performance MBA-620-Q4849 xxxx
Conclusion
When comparing the financial information between Company A and Company B, it is evident
that the industry was impacted an increase in COGs in 2018; both companies experienced a
decline in gross profit in this same period. Company A does appear to have rebounded in 2019
with a more significant decrease in COGs and an increase in revenue, when compared to
Company B. Both companies had an increase in Net earnings from 2018 to 2019, with Company
A showing stronger performance in this area. Company B has a stronger position when
comparing total assets; their total assets have been consistent over the 3-year period. Where
Company A had a $17,896 decrease in total assets from 2018 to 2019 - primarily due to the
decrease in Cash. Overall Total liabilities for Company A are lower than that of Company B.
Total liabilities and equity for Company B has been consistent year over year with a slight
decrease ($9,935) between 2018 and 2019. Conversely Company A was consistent between 2017
and 2018, with a decrease in 2019 of $17,895 - which can be attributed to the decrease in Debt
from prior year to 2019.
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