FINANCE

DETECTIVE
CASE







(taken from : Financial Statement Analysis, A Strategic
Perspective, Clyde P. Stickney/Amos Tuck School of
Business Administration, Darthmouth College)










SCHOOL OF BUSINESS AND MANAGEMENT
INSTITUT TEKNOLOGI BANDUNG

Finance Detective – Case

Effective financial statement analysis requires an understanding of the economic
characteristics of the firm being analyzed. Many of these economic characteristics are
captured in the relationship between various financial statement items. Exhibit 1
presents condensed financial statement information for firms in 13 different industries.
Balance sheet and income statements items are expressed as a percentage of total
revenues (that is, all amounts are divided by total revenues for the year). The 13
companies (all corporations except the professional basketball franchise) shown
represent the following industries:
1. Advertising agency
2. Aerospace manufacturer (significant government contracts)
3. Beer brewery
4. Computer manufacturer
5. Department store chain
6. Distiller of hard liquor
7. Electric utility
8. Finance company (also involved in leasing)
9. Grocery store chain
10. Life insurance company
11. Pharmaceutical company
12. Professional basketball franchise (a partnership)
13. Steel manufacture

Use whatever clues that you can to match the companies in Exhibit 1 with the
industries listed above.