In 2011 the current ratio was 1.86. By 2012, it decreased to 1.77 rating in the lower second quartile group in the industry. That said, Company G’s ability to repay its debt is consistent with showing a weakness from year to year based on the industry’s quartiles of 3.1 with a strong ability to cover liabilities 2.1 at the median to 1.4 stating a weakness. As such, this is an area of concern. 2.
In fiscal year 2008, the return on invested capital of continuing operations was 9.5% compared to fiscal year 2007’s 13.9%. The decrease reflects the decrease in operating profit that also impacts the rationalization charges. If the rationalization charges are excluded the return on invested capital for continuing operations would have been 11.4% (Phillips, Libby, Libby, 2011). The cash flow statement shows the movement of cash within a company. The cash flow statement is split into three categories: operating activities, investing activities, and financing activities.
Depreciation affects cash flow by reducing the amount of cash a business must pay in income taxes. 3. Calculate the current and quick ratios based on the projected balance sheet and income statement data. What can you say about the company’s liquidity position in 2013? AS the current and quick ratios both went down over the past year, I am concerned that the company liabilities may be rising faster than assets and we may not be able to liquidate assets quickly enough to cover debt, if necessary.
The ROE for Sepracor is 33.07%, which means that 33.07 cents of assets are created for each dollar that was originally invested. It measures how Sepracor is using its money. The higher the return on equity, the more funds available to be invested in improving business operations without having to invest more capital. Debt to asset ratio measures the company’s solvency, and the higher the ratio, the lower the borrowing capacity for the company. I would make an investment in the company’s 5% convertible bonds.
The return on equity for 2012 was at -1.81% compared to a 32% return on a wedding in 2011. (http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-reportsAnnual) Amazon had a downward trend on their return which could be an unhealthy position to be in if the trend continues into the year ending December 2013. Amazon did improve day’s receivable on average collection period. In 2012 days receivable was 81.2 days which was a decrease in time compared to 2011 for which day’s receivable was 87 days. As seen on the income statement by accounts receivable and annual credit sales Amazon was able to decrease the amount of days it took to collect on accounts receivable.
However, the company was not able to sustain the growth in sales between years 7 and 8, which resulted in a decrease in net sales of -15% or $897,000. The company’s loss in net sales in year 8 is a weakness due to overall sales being down. Cost of goods sold (COGS) between years 6 and 7 show an increase of 31.8% or $1,048M. The increase in COGS corresponds closely with the increase in net sales for the same time period, which illustrates the company’s ability to effectively control its inventory levels and material costs. For years 7 and 8, the cost of goods sold decreased by -14.5% or $630,400, which again corresponds to the change in net sales for the same period.
I don’t think Immelt’s past pay packages constructed to truly pay for performance. From Exhibit 2, we can find that the stock price of GE fluctuated and experienced a downward trend since 2007. In the first quarter of 2009, the stock price fell below 10 dollar. Despite such a loss in value, Immelt has been paid about $90 million in salary, cash and pension benefits. This amount does not include the $5.8 million cash bonus he was “awarded” in 2009, or the bonus he skipped in 2008.
Although the bonds have the lowest cost of issuance among the choices, its Net Present Value (NPV) of $219 million is lower than the HUD 242. The Business Dictionary defines NPV as “the difference between the present value of the future cash flows from an investment and the amount of investment” (Business Dictionary, p. 1, 2012). The collateral requirement for the bonds is also much higher than the HUD 242. Because the collateral includes escrow on ECH’s gross receivables, ECH possibly may have less control over its future revenue stream. The simulator also took note of the four-year time frame of the expansion project versus the three-year spending limit on the bonds.
How has Aurora Textile performed over the past four years? Be prepared to provide financial ratios that present a clear picture of Aurora’s financial condition. Exhibit 1 shows Income statement of Aurora Textile Company for the fiscal years 1999-2000. As mentioned in the introduction, Aurora had remained main efficient plants by reducing inefficient operations, but its sales show downward trend and in 2002, it decreased about 40% to compare performance in 1999. Due to the fact that Asian and other foreign textile manufacturers have been exported aggressively and consumer preferences are requiring higher-quality products with minimum defects, like other firms, Aurora tends to produce small amount of yarns produced with minimal period and provide to customized markets.
History of Coca-Cola Coca-Cola, the most recognized logo in the world. The Coca-Cola Company is the largest beverage company in the world. Starting just as a thought has become an icon and a demand of consumers across the globe. Jacob’s Pharmacy, Atlanta, Georgia, was the birthplace of Coca-Cola. In 1886, Dr John Pemberton took a three-legged brass kettle in his backyard to create the formula for Coca-Cola.