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Amazon Inc. Financial Statement Analysis
Amazon is a giant company in the stock market. However, the information derived from its financial statements indicates a few issues. For example, the current ratio is relatively small, less than 1.2 indicating that the company has less resources that cannot cater to short term liabilities. The net receivables' value is also relatively lower than net payables, indicating that vendors and suppliers owe the company much money than it owes customers and debtors. The income statement indicates that the company receives a relatively higher revenue from sales than previous years. Unfortunately, the company's higher overhead costs reduce net profits to a much lower value compared to gross profit. However, the equity-debt ratio was lower, indicating that the company hardly relies on borrowed finances but the stakeholders' capital. Cash flow records also show that the company is gradually improving.
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