Liquidity Ratios Liquidity ratios provide information about a firm's ability to meet its short-term financial obligations. The current ratio is the ratio of current assets to current liabilities: Current Ratio | = | Current Assets | | Current Liabilities | | * Interpretation: Current ratio comes from total assets divided by current liabilities. Current assets include cash, accounts and notes receivable (less reserves for bad debts), advances on inventories, merchandise inventories, and marketable securities. This ratio measures the degree to which current assets cover current liabilities. The higher the ratio the more assurance exists that the retirement of current liabilities can be made.
This choice does, however, affect how individual shareholders’ accounts are reported in the balance sheet. Formally retiring shares restores the balances in both the common stock account and paid-in capital - excess of par to how those balances would have looked if the shares never had been issued. Any net increase in assets produced from the sale and ensuing repurchase is reflected as Paid-in capital—share repurchase. On the other hand, any net decrease in assets resulting from the sale and subsequent repurchase is repeated as a subtraction of retained earnings. Inversely, when a share repurchase is seen as treasury stock, the cost of the treasury stock is naturally disclosed as a decrease in total shareholders’ equity.
Option (A) provides a clearer picture on how the stock options affect the company’s equity through the balance sheet. Expense: An expense represents the actual or expected cash outflow that results from an entity’s ongoing major or central operations. Option (A) values the compensation based on the value of the stock options. Therefore, this transaction
The balance sheet connects to income statements, in turn also connected to cash flow statement. Occurrences or a change to the net cash activities of the cash flow statement affects the balance sheet. The balance sheet is useful when estimating the potential of the organization in order for them to achieve there long-term mission. However, cash flow statement displays the exchange of currency among an organization and external agents. For example, the cash flow can be affected when the company purchases products, and if the costs of the products are an outstanding amount in turn it will affect the assets on the balance sheet.
The components of the statement of cash flow shows how changes in balance sheet and income accounts affect cash and cash equivalents, and breaks the analysis down into operating, investing, and financing activities. The statement shows the current operating results for a period of time. These details are reflected in the balance sheet. As an analytical tool, the statement of cash flows is useful in determining the short-term viability of a company, particularly its ability to pay bills. o Which financial statement is the most important?
CalPERS vs. JC Penney Overview CalPERS investment program began on February 22, 2000 when they included JC Penney on their annual Focus List. CalPERS further exclaimed that due to declining sales and a deteriorating customer base they had lost confidence in Penney’s management. Subsequent to the release of their focus list JC Penney made numerous strategic decisions to revitalize and boost the value of the company. Penney forced their current CEO James Oesterreicher to retire. Next instead of promoting from within, they searched for new blood and hired former Barney’s CEO Allen Questrom.
By 1987, she was regarded as a homemaker expert and signed a $200,000 deal as a lifestyle consultant and pitch woman for discount retailer with Kmart to develop a line of stylish but affordable merchandise. In 1990, Martha divorced her husband, Andy Stewart after he lived with her former assistant for three years. In July of 1991, The First issues of, “Martha Stewart Living,” were published. Just two years later, she started her own syndicated television show. In 1997, she created, “Martha Stewart Living Omni media,” to encompass all her business.
After two straight years of financial losses in 1994, CEO Ron Allen rolled out a new strategy called “Leadership 7.5.” Allen targeted to reduce Delta’s cost per each available seat mile from more than 10 cents to 7.5 cents, which would match that of major competitor Southwest Airlines (Bryant, 1997). Along with a new company strategy a change followed with Delta’s human resource strategy. This changing policy devastated employee morale and resulted in a decline of customer service, efforts to unionize, and dissatisfaction among personnel. Delta couldn’t keep the past primary policy about human resources so there were several significant changes in Delta’s organization and corporate culture. There are many programs that Delta has built after passing through the cost-cutting reformation in 1997 for getting back its capabilities on customer relationships like rewards and recognition program above and beyond and more.
Reducing operational surprises, improving deployment of capital, and reducing costs of control c. Improving deployment of capital, aligning risk appetite and strategy, and ensuring that objectives are achieved d. Reducing operational surprises, aligning risk appetite and strategy, and reducing costs of control 2. Which of the following is not considered a component of enterprise risk management? a. Internal environment b. Internal auditing c. Objective setting d. Control activities 3.
As a result, the company suffered a decline in customer satisfaction and financial performance. In the fall of 2006, the company’s CEO was replaced with new leadership. Frank Blake implemented a number of changes over the years. A number of these changes were focused on the company’s employees. As an experienced employee of Home Depot, I hope to shed light on some of these changes in relation to motivational practices in the