A few smaller points that are still worth mentioning are that the receivables have dropped 15%. This could be a sign that the company has stopped extending credit at the level they once were and are missing out on credit sales. Lastly, payables have increased 33% which means the company could be losing out on discounts for paying on time, or worse yet incurring charges for late payments. Given the amount of cash on hand the
1.What is the impact of the December 1993 shipments of conventional lenses to Bausch and Lomb 1993 financial statements? Is the impact significant? The impact was:- i)Increased revenue by $22M ii)Reduced inventory by 1.8 million pair. Based on the COGS of 45%, this could mean a reduction in inventory of close to $10M. iii)There is very little increase in SG&A as not much was spend in terms of sales effort.
We see this again from 2004 all the way to 2010 with unemployment increasing to 10%. We can see that the economy hits a recession after roughly 10 years of gradual expansion. Okun’s Law states that for every 1% rises in Unemployment, GDP decreases by roughly 3%. The above Scatter Plot chart shows data from 1981 to 2010 and we can see that for every 1% rise in Unemployment over this period, GDP dropped by 0.4%. This shows a negative slop and that the relationship is relatively weak due to the fact the GDP has decreased by less than 1%.
Hallstead Jewelers Required: How has the breakeven point in number of sales tickets (number of customers orders written) and breakeven in sales dollars changed from 2003, to 2004, and to 2006? How has the margin of safety changed? What caused the changes? The breakeven point has increased for both sales dollars and sales tickets from 2003 to 2006. The safety margin has also decreased over the time period.
Statistics state that the trade value of the U.S music market decreased 10.7% in 2009 due to the up rise in piracy. (IFPI Report) 1. In the 2011 IFPI report, under section 14 “Digital Piracy- Facts and Trends” it is stated, “Despite the surge by more than 1000% in the digital music market from 2004-2010, an estimated value of $4.6 billion, global recorded music revenues declined by 31% over the same period. The two figures powerfully illustrate how, in the face of piracy, even the most progressive strategy of licensing hundreds of digital music services has been unable to prevent the steady decline in the overall legitimate music market and that decline will continue unless action is taken.” B. The same database continues to give statistics about how there has been a steady decline in profits through album release and
Refer to situation anaylsis 2. Internal Marketing Audit Operating Results Total group sales have reduced by £225.9m to £923.2m, plus a 12.1 decline in sales. “An adverse movement in the Hong Kong dollar, offset by favourable movements in the Euro and Singapore dollar, impacted sales by £0.4m and operating profit by £nil.”(HMVgroup, 2012). Sales lessened from £1,102.2m to £873.1m and the costs afore tax and special items were £16.2m, which is down from a profit of £16.2m in the previous period. Furthermore, significant charges of withdrawn operation of £33.5m were sustained in the year.
Sales grew 33% in 06 and 22% in 07. There is a gap in the growth coming from sales where income is lost due to the increase in raw material prices and forecasted demand which led to an inventory cut. 4. Which is the EBITDA margin? | 05 | 06 | 07 | EBITDA Margin | 8.6% | 15.6% | 9.7% | 5.
During that time the Company experienced troubles and the revenue has fallen while debt taken on to finance mergers and infrastructure investment remained the same. Ultimately, the market value of the Company’s common stock plunged from about $125 billion in 2000 to less than $150 million as of July 1st 2002. Overall, more than $9 billion in false or unsupported accounting entries were made in WorldCom’s financial systems in order to achieve desired reported financial results. (WorldCom stock price) Quantification of Findings We have audited the accompanying balance sheets of WorldCom Corporation as of December 31, 1999 and December 31, 2000, and the related statements of income, cash flow, and stockholders’ equity for the period ended December 31, 1999 and December 31, 2000. During our review of the income statement we noticed that the Corporation mistakenly releases accruals and capitalize expenses that should be charged on expenses.
A Lorenz Curve shows a Gini coefficient which represents income equality – the figure zero represents total equality and a figure above one represents inequality. (Wikimedia Foundation, inc 2013). (Robert Reich, 2011) states that as a whole, our economy is becoming more and more unequal in terms of income distribution. The wealthy are getting wealthier and the less wealthy are getting less wealthier. From 1981 to present day, a period of time in which a recession has occurred we have seen growth slow down and the rich have taken home more than the poor.
The policy of reducing debt made MC leave the company with just $36 million cash which was well under the number of 1990 ($283 million cash ). MC’s stock prices fell more than two-thirds from $33.38 in 1989 to $10.50 in 1990, resulting in a drop of $2 billion in market capitalization; even if in 1991 it went up to $16.50. Another consequence was an important decrease of Times interest earned from 2.6 in 1989 to 1.4 in 1990 and 1.5 in 1991 which triggered a depreciation of bond rating from A3 in 1989 to Baa3 in 1991 quite close to junk bonds. For the future this is a strong signal of the MC financial crisis situation. Most liquidity and solvency indicators show that the group would have not been unable to cover its current obligations/liabilities and was close to bankruptcy.