BUS402 Assignments Week 4 - Interactive Assignment

Walmart Company: Operating Budget QI

Revenue [Prior Quarter] Budget Projection Next Q Var +/-

Var +/-

Sales 122,950,000 125,635,000 2,685,000 2%

Interest Income 50,000 54,000 4,000 8%

Other Income 976,000 980,000 4,000 0.4%

Total Income 123,926,000 126,669,000

Costs and Expenses

General, Operating and administrative expenses 25,791,000 26,481,667 690667 2%

Costs of sales 93,034,000 93,906,000 872,000 0.9%

Total Expenses 118,980,000 119,987,667 1007667 0.8%

Net Profit/ Loss 5,075,000 6,681,333 1,606,333 5%

Net Earnings Before Taxes (Gain or loss) 5,157,000 2,710,334 2,446,666 2%

Income Tax Expense 1,251,000 1,045,000 206,000 1%

Net Earnings After Taxes 3,906,000 1,665,334 2,240,666 2%

Ratio Analysis (Choose a minimum of two) [Prior Q] Proj. Q.

        Change	 

Profitability Ratio 4

Solvency Ratio 0.8

The company I chose is Walmart Inc. which largely engages in retail and wholesale businesses. Walmart offers an assortment of goods and services at low prices. Profitability ratio enables the company to measure its profits hence the general performance. This way, Walmart evaluates on areas to reduce and invest more to increase profit and reduce expenses. As seen in the profitability ratio, the company strives to make profits through offering a wide range of products including groceries. Globally, Walmart is one of the most known and valuable brands. The operating profit is projected to increase in future which will automatically increase the profit margin. However, their liquidity ratio is 0.8. It should cut off some expenses to avoid assets liquidity. If only the company strategies on how to increase their liquidity ratio, then there is danger ahead.