CanGo has very low profitability ratios, low turnover ratios and a high debt equity ratio. All these demonstrates that it’s in Cango’s best interest to take control of their financial performance, and focus on generating cash for the company, make better use of available resources and ensure that they are able to generate profit. The company should not take more debt and need to focus on how to use their existing resources to generate more cash flow to be able to operate and meet their financial obligations. Under the current operating system debt is increasingly being
When conducting an audit, one must develop a concrete understanding of a business and the type of environment the business operates in. The auditor must examine all the elements that make up the business and that also must include an understanding of the company’s internal controls. Once the auditor has a genuine understanding of the business; the auditor will establish material information, and create a series of procedures for the audit. In the instance of Apollo Shoes, an audit was conducted on the financial reports, the sales and collection cycle, and the payroll and personnel cycle. The final step of an audit design program would be to audit Apollo Shoes’ inventory and warehousing cycle and the cash cycle.
Financial Statements ACC/290 For a successful business and effective performance of the company is necessary to know basic assumptions of the analysis of financial statements. Financial statements is the understanding that the analysis should be subjected to observation, testing, evaluation and formulation of a diagnosis process that took place in company and that as such, are summarized and embodied in the financial report. Financial analysis is exhaustive research quantification, description and evaluating the financial status and performance of business operations. Companies are required to at the end of each financial year, after all business changes its accounting records locked, in order to determine the exact and final state which has the purpose of compiling the financial statements. This report contains information on the financial position, performance and any changes affecting the financial position of
Original AACSB: Analytic AICPA BB: Legal AICPA FN: Research Bloom's: Knowledge Difficulty: Hard 4. Custody of inventory is transferred to the shipping area upon authorization of: A. The customer order. B. The shipping order.
This Make or order strategy reduces the risk of creating unwanted inventory. This strategy is useful or applied in the following situations in the industries. 1. Product is very slow moving product in the market. 2.
One strategy that a business can implement is to cut costs. This could be done through either cost optimisation or cost minimisation. A cost minimisation strategy is one which will see the budget in all functional areas of the business be reduced in order to keep costs as low as possible. A cost minimisation strategy will be focussed on the short term and is therefore only a temporary strategy; the aim of a business that adopts this strategy will purely be to survive a recession and then continue to spend once the recession is over. One company that have adopted a cost minimisation strategy is Ryanair.
Investors investing in an IPO are aware that it takes time to see a solid return/profit when a company is expanding into new ventures and that risks are involved. Most importantly, investors know that a risk has to be taken for continued growth and for the health of the company. CanGo needs to offer an IPO so that they have the funding to expand and grow. Issue 4 Hidden costs The team at CanGo hasn’t even considered what the hidden costs to the business might be if they branch out into the new projects they are currently exploring. They are not adding additional staff, equipment, or software so spreading the resources out could cause the quality of the existing products to suffer.
The first function starts when the source of the supply is transferred to the producers of the product for the transformation process. Once the producers are finished, a distributor then process orders and prepares items for shipment after a review from the retailer. Retailers then receive the orders placed to put into inventory so that the consumers are able to purchase product. The order processing and management category is designed to offer consistent, objective and auditable inventory assessments for financial reporting purposes for the retailers to be able to compete in labor-intensive industries nationally, customary costing approaches help generate the most accurate collective values for the cost of goods sold and ending inventories (Lockarmy III & Smith,
“For instance, the fall in the wage lowers people’s income and thereby reduces demand. That reduction may feed back to firms and reduce the demand for their goods, which might reduce the firms’ demand for workers” (Colander, The Limitation of Supply/Demand Analysis, 2010). “If these effects do occur, and are important enough to affect the result, they have to be added for the analysis to be complete. A complete analysis always includes the relevant feedback effects” (Colander, The Limitation of Supply/Demand Analysis,
We understand that the sector will remain immune to market bumps and a few disruptive trends will probably persist. These might influence investment decisions. However, it should be kept in mind that the consumer staples sector has the potential to face the headwinds. In short, based on my analysis, both Kellogg and J.M. Smucker are expected to have a low growth rate in the future, with J.M.