negative 2500 $.The company needs to raise about 40,000 $ as the ending cash balance for the month of July is negative 40,000 $. The Company can get a short term loan for 40,000 $ which can be repaid in October. 2. Even though the Company started with a Capital of 250,000 $ it still ends up with a zero bank balance. This is because the increase in the collections of Accounts Receivable from customers is not sufficient to recover the total disbursements (variable production cost and the fixed cost).
What steps do you recommend the company take? Base your forecasts on the 1996 performance. • Finance it through debt; it has so little and is a big company by this point. But don’t take too much, still achieve a DPO reduction so that the debt is minimal • No, it will not be possible. • Would need to reduce working capital by $260M • Would need to increase gross margins by 328bps • If growth is so important, then a price raise would likely slow that.
Municipal bonds had traditionally been considered an effective investment vehicle for property casualty insurance companies and for individuals in high federal tax brackets. For that reason, face value yields on muni bonds are generally below those of Treasuries given the net premium after-tax considerations. At the time of the case, the top marginal federal income tax rate was over 50% (not including state and local taxes). In the years leading up to the case, both interest rates and the marginal tax rate had been very volatile. The top marginal tax rate at the time the portfolio had been purchased was 70%, it then fell to 50% and was scheduled to drop further in the coming years.
Currently, Thorr is experiencing a decline in sales because of changes in its target market and competitor’s gain in market share. Thorr’s marketing management has options to maintain, enhance, or create a new marketing strategy. Management can use a different positioning strategy for Cruiser Thorr or launch a new product (University of Phoenix, 2008). Phase One: The Situation The first phase of the problem indicates that Thorr sales are decreasing, “The motorcycle industry is growing annually, but sales of Thorr Motorcycle’s existing product CruiserThorr (a 1500cc power cruiser priced at $25,800) are deceasing” (University of Phoenix, 2008). The marketing manager must ascertain present market position to create a new marketing plan that will reverse the current downward trend.
As Jones sales growth rate is high than sustainable rate, so its net earning could not support increased account receivable and inventory. Then the company need bank loan to finance the increase business. 2004 2005 2006 First Quarter 2007 collection period 42.0 days 44.0 days 43.0 days 43.9 days payables period 10.1 days 10.0 days 24.1 days 37.4 days 3.Is Nelson Jones’s estimate that a $350,000 line of credit is sufficient for 2007 accurate? What will happen to Jones’s financing needs beyond 2007? Jones currently has $203,000 of accounts payable.
The company knew that these customers’ usage was inconsistent and that they did not like the confusion current rates created. Customers wanted clear, flexible plans. They were unable to predict their own usage so they usually ended up paying more than they wanted to. Peak hour’s rates, extra minutes and one-time costs increased monthly bills unexpectedly. Pre paid plans were unusual because of prohibitive pricing (starting at 35 and as high as 75 cents) In 2001 mobile entertainment represented $10 billion and was projected to increase steadily over the next few years.
Although United States may be in a recession and Vanilla Bicycles doesn’t offer the cheapest bikes around, averaging 7,000 dollars a bike, it hasn’t stopped bicyclist from buying high-quality American-made bikes. The company has an income of 300,000 dollars a year, earning 100,000 dollars in profit, which is more than enough to keep White from ever having to become a bike messenger again. This article reminded me of Chapter 2, Competing in Global Markets, due to the reasons of other bicycle companies that are imported into the country with a much lower resale value. Not only does White face competition from bikes made in China, but other American-made
Audi's global sales rose 8.3% to 1.58 million vehicles in 2013 however despite the increase in revenue, the net profit fell 7.7% ($5.57billion) and the operating profit margin fell to 10.1% from 11% the previous year. Based on this one could assume Audi is experiencing diseconomy of scale. But when you dig deeper into their situation the reasons for a lower net profit is not because of a “per-unit” cost of production which would truly mean they are operating as a diseconomies of scale. The true reasons appear to be because of their expansion investments. As per the article Audi “warned that profit would be hit by investment in new models and tougher climate regulation”.
If the company continues to loose billions of dollars year after year adjustments need to be made somewhere, so the concentration should be put in the plants that are successful and slow production in the lagging plants or just simply close down. Second I would choose to reduce the SUV and truck lines because of the high gas prices throughout the country simply because the smaller cars would be more gas efficient, more cost efficient, and a lot of money being lost through the lack of being able to sell the expensive SUV’s which also doubles in cost to fill up and drive on a daily basis. Most Americans are buying the smaller cars because of the recession or the public opinion that we are in a recession. Third, would be to go ahead and sell the premium automobile group to somebody that would be able to make use and profit off of the lack of sales year after year. Cars like Jaguar and especially Aston Martins which are one of the most expensive cars in the world, don’t really sell on a large scale in the US except for the wealthy percentage of the population, so selling the premium automobile group should be a good business decision especially since the PAG group doesn’t fit the way Ford intended their business to be operated.
He uses "savings", "Governments would save money", "$21 billion per year", in an attempt to emphasise his "commuters" that using public transport is better because it assists people to reduce the amount of money they spend each week when driving. This persuades the reader to agree as he uses a series of numbers and savings to support his argument. Similarly, the image clearly demonstrates that the hip pocket nerve can also appeal to the public which creates happiness in the community. This is emphasised by the expressions of the people which show they are pleased with the use of free transport. This persuades the reader to be satisfied with the use of the hip pocket nerve.