Harley Davidson Performance AnalysisThere are many ways to analyze a company's performance, some more popular than others. According to Barney's text, the accounting method is the most common way to measure a company's performance (Barney, 2002). Some of the reasons for this popularity might include the fact that accounting measures of performance are publicly available in many companies and communicate a lot of information about a company's operations. Other methods of performance analysis include business survival and the multi-stakeholder approach. The first method we will look at is the accounting method. Through this accounting approach we will analyze specific ratios and their possible impact on company performance. Specific ratios we will look at include return on total assets, return on equity, gross profit margin, earnings per share, price-to-earnings ratio, debt to assets, debt to equity, turnover accounts receivable, total asset turnover, fixed asset turnover and average collection period. I will explain each ratio in more detail and why I included it in this analysis when I give the results of each specific ratio calculation. Return on total assets (ROA) is an overall measure of profitability that measures management's total effectiveness in generating profits with its available assets. This ratio indicates the amount of net income generated by each dollar invested in assets. The higher the company's return on total assets, the better. Harley Davidson's return on total assets was 14.04% for 2001, and 14.27% for 2000. These percentages are high and show an upward trend, showing strong performance in this area over the over the last two years. Return on equity (ROE) measures the profitability of total assets. shareholder point of view. ROE is a calculation of the return earned on common shareholders' investment in the company. In general, the higher this yield, the better the situation for shareholders. Harley Davidson's return on equity was 24.92% for 2001, and 24.74% for 2000. They have maintained consistent, positive returns for their shareholders over the past two years. The next ratio we will look at is gross profit margin. Gross profit margin (GPM) measures the percentage of each sales dollar remaining after the company has paid for its goods. The higher the gross profit margin, the better. Harley Davidson's gross profit margin was 35.08% for 2001, 34.09% for 2000. The fourth ratio we will analyze is earnings per share. Earnings per share (EPS) is the number of dollars earned during the period on behalf of each share of common stock outstanding..