Financial Ratio for Krispy Kreme and BCG Matrix for McDonald's Assignment

Financial Ratio for Krispy Kreme and BCG Matrix for McDonalds - Assignment ExampleThe measurement considers all assets including inventory, accounts receivable, and quick-frozen assets.The lower the dimension, the more slowly the firms sales are. Comparing the number to past years corporation data is important in methodicalness to see trends that have developed. In addition, comparing it to the industry standard is useful in order to see how the company compares to its prime competitors. If a problem exists with a low ratio, it could be possible that one or more of the firms asset categories have problems that need addressing. (Peavler, pp 1-2).Krispy Kremes total assets turnover ratio of 1.9 times is better than its prime competitors of McDonalds and Starbucks. McDonalds has a current total assets turnover of .80 times, trance Starbucks Corporation has a current total assets turnover of 1.7 times. (ADVFN, PLC) Hence, this is listed as an boilersuit strength or competitive advan tage for Krispy Kreme.The second ratio examined is Krispy Kremes debt to honor ratio. The ratio is calculated as Total liabilities / Stockholders Equity. A high debt to equity ratio would indicate that the company has financed its growth through debt. The main issues would be if the company overextended itself and took on too much debt, or if it has to lift a large amount of interest due to the existing debt.High or increasing debt ratios in relation to equity can be mordacious since it would indicate that the company is being financed by creditors instead of internal cash flows. (www.enterpernuer.com website). Krispy Kremes debt to equity ratio of 1.05 is higher than its prime competitors. McDonalds Corporation has a .81 ratio, while Starbucks has a low .18 ratio. (ADVFN, PLC). Overall, 1.05 of Krispy Kreme is not an evident weakness, since using some leverage is not considered a clear weakness.The third ratio examined is the return on equity ratio. It is calculated as follows N et income / Common Equity. This ratio is especially useful for shareholders who are interested in knowing what profits earned by the company can be made available to pay dividends.