FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The specific financial aspects to be considered with your analysis are:
• Profit Margin
• Total Owners' Equity.
Current Ratio.
• Return on Equity.
• Debt Equity Ratio.
• Earnings per Share.

Dammam Manufacturing Company is interested in investing in a new regional
project beginning of 2020. There were three similar firms for potential investment
opportunity. The following financial information were available to help the
company make the right decision:
Financial Information 31/12/2019
Firm A
Firm B Firm C
Information from the income statement in
Saudi Arabia Riyal (SAR):
Total revenue
10,099,0003,816,0001,277,550
Total expenses
9,503,000 3,618,0001,822,748
Information from the balance sheet in
Saudi Arabia Riyal (SAR):
Current assets
1,946,000 1,020,000 526,549
Total assets
8,668,000 8,183,000 3,783,127
Current liabilities
2,356,000 895,000 693,809
Total liabilities
4,587,000 5,944,000 3,089,318
Total common stock outstanding
225,800 389,000 168,238
The three firms are competing within the same market segment. The Chief
Executive Officer (CEO) of Dammam Manufacturing Company is studying the
financial information of the three firms but he couldn't make a decision, so he
asked you, as a financial expert to analyze and interpret specific financial
aspects of the firms and recommend which firm should Dammam Manufacturing
Company invest in and why?
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Transcribed Image Text:Dammam Manufacturing Company is interested in investing in a new regional project beginning of 2020. There were three similar firms for potential investment opportunity. The following financial information were available to help the company make the right decision: Financial Information 31/12/2019 Firm A Firm B Firm C Information from the income statement in Saudi Arabia Riyal (SAR): Total revenue 10,099,0003,816,0001,277,550 Total expenses 9,503,000 3,618,0001,822,748 Information from the balance sheet in Saudi Arabia Riyal (SAR): Current assets 1,946,000 1,020,000 526,549 Total assets 8,668,000 8,183,000 3,783,127 Current liabilities 2,356,000 895,000 693,809 Total liabilities 4,587,000 5,944,000 3,089,318 Total common stock outstanding 225,800 389,000 168,238 The three firms are competing within the same market segment. The Chief Executive Officer (CEO) of Dammam Manufacturing Company is studying the financial information of the three firms but he couldn't make a decision, so he asked you, as a financial expert to analyze and interpret specific financial aspects of the firms and recommend which firm should Dammam Manufacturing Company invest in and why?
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