Financial Performance Analysis of Companies A and B in Power BI

1 Power BI Executive Summary Assignment TaKesha Chaney Southern New Hampshire University MBA-620-Q5853 Measuring Success in an Org 23TW5 Instructor: James Walters August 4, 2023

2 Financial performance of Company A and Company B Analyzing financial statements is important in measuring the financial performance of a company. This executive summary constitutes visualization and analysis of companies A and B's balance sheets and income statements to understand each of the companies' performance from 2017 to 2019. 1. assets, liabilities, and owner's equity of company A and Company B over three years Company A Looking at Company A's column charts below, it's clear that the company's total assets remained almost the same in 2017 and 2018, just over $100,000 annually. However, in 2019 the total assets dropped drastically to just over $80,000 annually. This implies that company A may have sold some of its assets. The total liabilities and shareholders' equity remained almost unchanged in 2017 and 2018 but dropped in 2019. Since on a balance sheet, Assets = Liabilities + Shareholders Equity, after analyzing the company's balance sheet data, one can see that the company's total liabilities remained pretty much the same in 2017 and 2018 and significantly dropped in 2019. Looking at company A's balance sheet data shows that the company's total liabilities in 2017 were $31,560 and 31, 926 in 2018. The amount dropped to $11, 651 in 2019. A drop in Company A's total liabilities indicates that it paid back what it owed suppliers in 2019. As per the balance sheet, the company's equity decreased slightly from $72,756 in 2017 to $72 408 in 2018 and then increased to $74 788 in 2019. This increase in equity implies that the company's earnings or capital increased in 2019.

3 Company B Company B's column chart shows decreased total assets over the three years. In 2017 the total assets amount was $124, 316; this slightly dropped to $123, 236 in 2018. In 2019 the amount dropped significantly to $113, 301. As indicated in the column chart below, the company's total liabilities and shareholder's equity slightly dropped in 2018 and dropped even further in 2019. To explore the liabilities and equity separately, it's considered that Assets = Liabilities + Shareholders' Equity in a balance sheet. Looking at Company B's balance sheet data shows that the company's total liabilities remained almost motionless in 2017 and 2018, where they were just above $90,000 annually, but in 2019 the amount dropped to $80 000 annually. However, the shareholder's equity remained almost unchanged, just over $32, 000 annually.

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4 2 . Gross revenue and net earnings for Company A and Company B over three years Company A The line chart below illustrates that company A's gross revenue did increase over the three years from $27, 981 in 2017 to $28, 772 in 2018 and then $29, 580 in 2019. However, the net earnings decreased drastically to a negative in 2018 and increased again in 2019, resulting in 2018 being the company's worst financial year. The net earnings across the three years were $1 864 in 2017, $(170) in 2018, and $2 380 in 2019.

5 Company B Company B's gross revenue decreased in 2018 and increased again in 2019. The revenue amount in 2017 was $27, 981 and this dropped to $26, 302 in 2018 and increased to $27, 091 in 2019. The company's net earnings remained unstable across the three years, whereby in 2017, the net earnings amount was $ 2, 025 and dropped significantly to $(529) in 2018, and in 2019 the amount increased to $79. Due to decreased earnings, the company made a loss in 2018, and it was its worst year.

6 Conclusion Based on the balance sheet and the column charts illustrations, the two companies are in good financial health. The asset value of each company is higher than the liabilities value. Both companies have positive shareholders' equity, implying they have sufficient assets to cover their liabilities. Notably, the companies' liabilities declined over the three years. However, company B seems to have more total assets, total liabilities, and shareholders' equity. Looking at the income statements and the line charts of the two companies, it's clear that company A is doing better than B as it made higher profits in 2019. Both companies made losses in 2018, and even though they both recovered in 2019, Company A had a better recovery and made higher profits in 2019. Additionally, Company A shows more financial consistency in terms of gross revenue, profit, and net earnings. Overall, company A seems more financially healthy than company B.

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Power BI executive summary assignment

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