Financial Statement Analysis for Johnson & Johnson
For this project you will be completing a financial statement analysis for Johnson & Johnson. All the materials that you will need in order to be able to conduct this analysis will be available to you on Brightspace. This project is due by 11:59 PM EST on April 1, 2022.
You will be submitting a 4-5 page written paper (in PDF format), along with a spreadsheet (using the provided template) with:
1. The following financial statements for the firm (each in its own tab of the spreadsheet)
a. 2021 Balance Sheet (this will include data from the 2019 Balance Sheet that you manually add)
b. 2021 Income Statement
c. 2021 Statement of Cash Flows
2. Ratio Analysis (in a separate tab on the spreadsheet)
Please complete all calculations in your spreadsheet. You MUST use cell references. Points will be deducted for students not using Excel for calculations. Clearly label all worksheets in your spreadsheet so I can easily follow your work. Your written paper should include a brief introduction and conclusion and answer the questions below, using the calculations in your spreadsheet for support. Clearly state which items in your spreadsheet you are referring to in your paper (use the column letter and row number).
Your written paper should include responses to the questions below. You should discuss and explain your financial analysis of Johnson & Johnson in your paper. Any assumptions must be clearly discussed in your paper.
(more information is in the FIN 311 Take Home Project Spring 2022.pdf)
Financial Statement Analysis
Author
Affiliation
Course
Instructor
Due Date
Johnson & Johnson Financial Analysis
Johnson & Johnson is an American corporation based in New Jersey that was founded in 1986. Medical devices, drugs, pharmaceuticals, and consumer goods are all developed and sold by the company. The development of the coronavirus vaccine is Johnson & Johnson's most recent and significant achievement. The business is extremely valuable and has excellent credit ratings. Joaquin Duato, who also serves as Chairman, is the company's current Chief Executive Officer. First aid kits, bandages, Johnson's Baby products, Janssen Pharmaceuticals, and other major products are associated with the company. The company appears to be doing well financially, as evidenced by the financial statements, which show consistent increases in sales and profits. The company's balance sheet also indicates that it is in good financial shape. Our investigation will focus on the company's financial statements, as well as its performance and forecasts for 2022. We recommend the following external financing options as part of our research: lease or hire purchase options, debentures, or preferred stocks. Because the company has a consistent income and a healthy balance sheet, it is able to pursue debt financing.
Income statement
LINK Excel.Sheet.12 "D:\\top writers\\March\\F00145028.xlsx" "Income Statement !R5C1:R34C8" \a \f 4 \h \* MERGEFORMAT
Common Size Income Statement
Period Ending:
2021
2020
2019
2018
2021
2020
2019
Revenue
93,775
82,584
82,059
81,581
1
1
1
Cost of Revenue, Total
29,855
28,327
27,456
26,986
31.84%
34.30%
33.25%
Gross Profit
63,920
54,257
54,603
54,595
68.16%
65.70%
66.12%
Total Operating Expenses
70,999
66,087
64,731
63,582
75.71%
80.02%
78.38%
Selling/General/Admin. Expenses, Total
23,559
21,084
22,178
22,540
25.12%
25.53%
26.86%
Research & Development
14,714
12,159
11,355
10,775
15.69%
14.72%
13.75%
In process R &D
900
181
890
0.96%
0.22%
1.08%
Interest Income
(53)
(111)
(357)
394
-0.06%
-0.13%
-0.43%
Interest Expense
183
201
318
394
0.20%
0.24%
0.39%
Unusual Expense (Income)
5,141
5,428
1,456
1,826
5.48%
6.57%
1.76%
Restructuring
252
247
266
1,061
0.27%
0.30%
0.32%
Operating Income
22,776
16,497
17,328
17,999
24.29%
19.98%
20.98%
Net Income Before Taxes
22,776
16,497
17,328
17,999
24.29%
19.98%
20.98%
Provision for Income Taxes
1,898
2,083
2,209
2,702
2.02%
2.52%
2.67%
Net Income After Taxes
20,878
14,414
15,119
15,297
22.26%
17.45%
18.31%
Net Income Before Extraordinary Items
20,878
14,414
15,119
15,297
Total Extraordinary Items
-
300
-
-
Net Income
20,878
14,714
15,119
15,297
Net earnings per share (Notes 1 and 15) Basic $7.93 5.59 5.72
8
6
6
-
Basic Weighted Average Shares
2,632
2,632
2,632
2,632
Dividends Paid: →
$11,638.76
Payout Ratio: →
4.42
LINK Excel.Sheet.12 "D:\\top writers\\March\\F00145028.xlsx" "Income Statement !R2C1:R34C12" \a \f 4 \h \* MERGEFORMAT
In the last three years, the income statement has shown consistent growth. From $82,584 million in 2020 to $93,775 million in 2021, revenue increased. The average cost of goods sold (COGS) is 33.13 percent of revenue. Our 33.13 percent estimate of COGS sold for 2022 was based on the average percentage of COGS. Similarly, the average net operating expense was 78 percent, which led to the assumption that total operating expenses would be similar. As a result, based on the 3-year average, operating profit is estimated to be 21%. Furthermore, the cash dividend payment from the cash flow statement over the previous three years guided the computation of dividends paid. Because a one percent growth rate was observed, the dividends for 2022 were calculated using a one percent increase from the previous year.
Balance sheet
Period Ending:
2021
2020
2019
2018
Common Size Balance Sheet
2021
2020
2019
Cash and Short Term Investments
31,608
25,185
19,287
19,687
30.28%
26.93%
27.10%
Total Receivables, Net
15,283
13,576
14,481
<...
👀 Other Visitors are Viewing These APA Essay Samples:
-
Career Preparation: Timeline of Career in Accounting
2 pages/≈550 words | 2 Sources | APA | Accounting, Finance, SPSS | Other (Not Listed) |
-
Factors that Contributed to Molson Coors Co. Financial Restatement
2 pages/≈550 words | 1 Source | APA | Accounting, Finance, SPSS | Other (Not Listed) |
-
Calculating Future Cash Flow
4 pages/≈1100 words | 2 Sources | APA | Accounting, Finance, SPSS | Other (Not Listed) |