Costco Assignment
Financial Statement Analysis
Task:
Your task is to develop a detailed Financial Statement Analysis for Costco Wholesale in 2001. You should include information
from your Week 3 homework assignment and the class discussion in Week 4. Discuss the following items:
1) What is Costco’s primary market? Who are its competitors, and what is its strategy?
2) How have Costco’s revenues, operating income, and net income changed from 1997 to 2001? Why was Costco not more
profitable in 2001? Refer to Exhibit 5.
3) Select 2 profitability and 2 liquidity/solvency ratios. Analyze them in detail and explain how Costco could improve
these measures in the next 5 years (after 2001).
4) Based on your analysis, provide a forecast for the company’s financial performance in the coming five years after 2001
(in broad terms). Focus on the company’s future profitability and potential future financial risks. Also, discuss how
Corporate Social Responsibility (CSR) initiatives may help Costco to achieve its long-term financial goals.
5) In your Week 3 homework assignments, you briefly discussed Costco’s strengths and weaknesses. Which areas would
Costco need to improve for you to consider investing in this company?
Format of Paper:
– There is no strict minimum or maximum length. The majority of well-structured financial statement analyses in the past
were about 2-3 pageslong.
– Font size 12.
– Single-spaced.
– Font type: Times New Roman.
– Please submit your analysis as a Word or PDF file via Canvas.
