...The newly assigned management has negotiated a credit line with one bank, of which it has used immediately KCHF 50 for IT Equipment Please set-up the initial balance for this company. Cash and Equivalent: Receivables: Tangible assets: Cash received 340 Not paid up capital 180 Building 300 Mortgage 100 Total 180 Car pool 80 Total 440 IT-Equipment 50 Total 430 Credit lines: Mortgages: Share capital: Credit line 50 Mortgage 100 Paid as assets 380 Total 50 Total 100 Not paid up 180 Cash 340 Total 900 ----------------------- Initial Balance Sheet as at Foundation date (in KCHF) Current Assets Short-term liabilities Cash and Equivalent 440 Credit lines 50 Receivables 180 Long-term liabilities Mortgages 100 Fixed Assets Equity Tangible Assets 430 Share capital 900 1’050...
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...Operating assets in 1995 = Total assets – short term investments = 1,594 – 484 = 1,110 Percentage of Operating assets in sales = 1,110/3,475 = 32% Operating assets required in 1996 for 52% growth = 0.32*5,296 = 1,695 So, increase in operating assets in 1996 to obtain 52% growth = 1,695 – 1,110 = 585 From balance sheet of 1996, operating assets = 2,148 – 591 = 1,557 So actual increase in operating assets in 1996 = 1,557 – 1,110 = 447 With efficient management of total assets, Dell had reduced its required operating assets by $138 Also, increase in current liabilities in 1996 = 939 – 752 = 187 Net profit in 1996 = 272 Total funding through current liabilities and net profit = 187+272 = 459 Dell had funded its 52% growth in 1996 internally as total funding through current liabilities and net profit > Operating assets required to finance 52% growth. Even long term liabilities were not changed in 1996 on comparison with 1995. Q3) Assuming Dell sales will grow 50% in 1997, how might the company fund this growth internally? How much would working capital need to be reduced and/or profit margin increased? What steps do you recommend...
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...Business Plan – International Urgent Care Clinic Karen Hernández Marisela Rodríguez Carlos Fernández ENTR 360 July 10th, 2012 Prof. Harold Chittenden International Urgent Care Clinic - Business Plan Executive Summary As part of its constant efforts to improve access to urgent care in touristic areas, International Urgent Care Clinic will be open its facilities in International Drive in Orlando, Florida. The clinic will be owned and managed by Dr. Carlos Fernández, Dr. Karen Hernández and Dr. Marisela Rodríguez as a partnership. They will be responsible for ensuring the general health of their patients and creating a viable and profitable business medical practice. Throughout the first year, the doctors will work with their capital to get the clinic on a good financial and operational stability, using this urgent care clinic business plan as a guiding management tool. The doctors will focus on diagnosing and treating urgent care conditions of all ages while emphasizing on the overall health and wellness of their patients. The clinic will utilize new equipment and a trained staff that will be able to improve the care of each patient. Internantional Urgent Care Clinic will try to provide the most complete medical care possible in order to optimize the care and well-being of each patient. The marketing strategy involves a combination of print media advertising, website development, networking, and promotional events, all aimed at tourist and residents living within...
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...Competition Bikes, Inc. Financial Statement Analysis 3 Horizontal Analysis There are several methods used by companies and investors to assess a business’s overall financial health. One such method is horizontal analysis, which compares the financials of a company’s balance sheet and their income statements over two or more accounting periods. Comparing these numbers over a defined period of time enables the management and potential investors to see if the financial situation of the company is improving or time or not and what factors may be contributing to the increases or decreases in specific areas. For Competition Bikes, Inc. horizontal analysis, years 6, 7 and 8 were compared. Looking first at the comparable income statements we see that comparing years 6 and 7 in net sales there was a significant increase of 33%. Comparing years 7 and 8 there was then a decrease of 15% in net sales. Competition Bikes, Inc. states that this is due to the economic downturn and the fact that their main customer base of professional riders lost sponsorships thus less bike orders occurred. Although net sales did decrease from year 7 to 8, both of those years net sales were still significantly higher than year 6 indicating sales are trending upwards which is a strength. Competition Bikes, Inc. operating expenses have also changed over the three years. Comparing years 6 and 7 there was total increase...
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...Accountants usually categorise employees as a liability due to their wages and superannuation. But in the place where companies offer services instead of goods, we often hear that human resources or people are the most valuable asset. The reasons why businesses don’t usually value human assets are: (1) in practice we just haven't worked out a proper way to value these people and it is difficult; (2) some companies also believe that they do not own people and therefore should not account for them. However, companies do benefits from their employee’s work. In companies such as Apple, human resources are core to the business success due to their knowledge, skills and creativity. They represent a valuable resource and should be placed on the left side of the balance sheet. The benefit of treating employee as valuable assets is that companies which invest in their employees create a positive environment so that they can work and perform better financially. One example of an organization that has done this is Infosys (The Commerce Pedia, 2012), the giant Info Technology services firm in India. The entire workforce within the firm was assigned a value using an accounting model that calculates all of its employees’ collective worth. By doing this, Infosys has a significant commitment to investing in employees across all functions and levels of experience and the firm can take managerial decisions based on the availability and the necessity of human resources. After considering the...
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...farmers’ Balance Sheets, along with any ratios relevant to the case. Finally, I will make a recommendation to the Chief Scribe as to which noble he should invest in. PHENOMENON AND ATTRIBUTE OF INTEREST A phenomenon is defined as the object of interest that is being measured, while the attribute of interest is said to be the characteristics or qualities of the phenomenon. In “A Tale of Amenhotep”, the phenomenon is the performance of each of nobles’ farms, whereas the attribute of interest to the Chief Scribe is the efficiency that each farmer conducts his work. This efficiency can be evaluated by showing the relationship between total debt and total assets (debt ratio), as well as the relationship between current assets and current liabilities (current ratio). Furthermore, by incorporating each of these ratios one can realize which of the two nobles were able to utilize their assets more efficiently. BALANCE SHEET ANALYSIS Once looking over the Balance Sheet I was able to calculate each of the farmers’ debt ratios which is a measure of financial risk. So by dividing total debt by total assets I discovered that Sihathor’s ratio was 0.069 while Pemsah’s was 0.062. Due to the fact that each of these nobles’ ratios are substantially less than one we can infer that they have much more assets than debt, which is a positive attribute. At the same time it seems as though Pemsah has a slightly lower ratio which in turn shows his farm is less risky than Sihathor’s. Risk is an important...
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...AIR BERLIN & EASYJET FINANCIAL COMPARISON 2009 -2011/12 MARKING GRID FOR STUDENTS |CRITERIA |Total marks |COMMENTS | | |available | | | |% | | |Quality of presentation: |7.5 |Professional presentation expected | |correct referencing / bibliography| |Font size 12 Times New Roman | | | |Standard margin sizes, headers & footers | | | |In text citations and Harvard style Referencing where appropriate | | | |All tables, graphs, charts and calculations to be placed in the appendix and | | | |cross referred to in the main text. | | | |Report style language – not essay | |Structure of Report |7.5 |Should include:- ...
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...Business Analysis Part Two MGT 521 October 8, 2012 Business Analysis Part Two The Lockheed Martin (LM) Corporation has just reached a milestone of 100 years of services whereas building relationship as a reputable leader in the industry. The company continues to undertake changes in the past decades despite the troubling business environment. They have continued to record another year of superb financial results through operational guidance and service. Their ability to provide a well-balance company portfolio and support a strategic execution plan has responded effectively to the instabilities within the global market. As LM defines the industry supporting their four primary business segments in the fields of Information Systems and Global Services (IS&GS), aeronautics, space, and electronic systems. The consistently of these programs has allowed LM to be financial stronger in 2011 compared to 2010 with sales reaching to 46.5 billion, representing a two percent increase over 2010, (LM Annual Report, 2011, p. II). LM continues to balance strategically their net cash through operating activities in 2011 to $4.3 billion after the contributions of $2.3 billion to their pension plans supporting their retirement obligations for their employees. The continuing effort of cash deployment has supported their strategic plan for 2011. They had deployed cash supporting shareholders value from cash dividends, and share repurchases of $1.1 billion, and $2.4.billion...
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...PROJECT A - Case 9-30 Student Name: xxx SALES BUDGET: April May June Quarter Budgeted unit sales 65,000 100,000 50,000 215000 Selling price per unit 10 10 10 Total Sales 650,000 1,000,000 500,000 2,150,000 26000 SCHEDULE OF EXPECTED CASH COLLECTIONS: 40000 April May June Quarter 20000 February sales $26,000.00 $- $- $26,000.00 86000 March sales $280,000.00 $40,000.00 $- $320,000.00 April sales $130,000.00 $455,000.00 $65,000.00 $650,000.00 May sales $- $200,000.00 $700,000.00 $900,000.00 June sales $- $- $100,000.00 $100,000.00 Total Cash Collections $436,000.00 $695,000.00 $865,000.00 $1,996,000.00 MERCHANDISE PURCHASES BUDGET: April May June Quarter Budgeted unit sales 65,000 100,000 50,000 215,000 Add desired ending inventory 40,000 20,000 12,000 72,000 Total needs 105,000 120,000 62,000 287,000 65000*40%26000 Less beginning inventory (26,000) (40,000) (20,000) 26,000 10000*40%40000 Required purchases 79,000 80,000 42,000 201,000 Cost of purchases @ $4 per unit $316,000.00 $320,000.00 $168,000.00 $804,000.00 79,000*2 158000 80000*2 160000 BUDGETED CASH DISBURSEMENTS FOR MERCHANDISE PURCHASES:...
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...(Prudence); • Materiality; • Objectivity. 2.2.1 Business Entity Concept The concept of business entity assumes that business has a distinct and separate entity from its owners. It means that for the purposes of accounting, the business and its owners are to be treated as two separate entities. Keeping this in view, when a person brings in some money as capital into his business, in accounting records, it is treated as liability of the business to the owner. Here, one separate entity (owner) is assumed to be giving money to another distinct entity (business unit). Similarly, when the owner withdraws any money from the business for his personal expenses(drawings), it is treated as reduction of the owner’s capital and consequently a reduction in the liabilities of the business. The accounting records are made in the book of accounts from the point of view of the business unit and not that of the owner. The personal assets and Theory base of Accounting25 liabilities of the owner are, therefore, not considered while recording and reporting the assets and liabilities of the business. Similarly, personal transactions of the owner are not recorded in the books of the business, unless it involves inflow or outflow of business funds. 2.2.2 Money Measurement Concept The concept of money measurement states that only those transactions and...
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...(A) Date Description Ref Debit Credit 1-Mar Cash 101 10244 L. Eddy, Capital 301 10244 1-Mar Equipment 157 5,620 Cash 101 2,810 Accounts Payable 201 2,810 Cleaning Supplies 128 1200 Accounts Payable 201 1200 Prepaid Insurance 130 1200 Cash 101 1200 Accounts Receivable 112 4800 Service Revenue 400 4800 Accounts Payable 201 2000 Cash 101 2000 Salaries Expense 726 1800 Cash 101 1800 Cash 101 1400 Accounts Receivable 112 1400 Accounts Receivable 112 2500 Service Revenue 400 2500 Gas & Oil Expense 633 200 Cash 101 200 L. Eddy, Drawing 306 700 Cash 101 700 EDDY’S CARPET CLEANERS (B) & (C ) Worksheet For the Month Ended March 31, 2008 "Adjusted Trial Balance" "Income Statement" Account Titles Trial Balance Adjustments Balance Sheet Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Cash 2,500...
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...the Tootsie Roll Industry has maintained an innovative stand within the market. Expanding production of new products and manufacturing buildings the Tootsie Roll Industry are in need of a loan that will help increase the company’s liability by 10%. To accomplish this increase an adequate loan package will help in seeking for those needed funds. The loan package will include a liquidity ratio, solvency ratio, and profitability ratio explaining how and why the loan will be beneficial to the Tootsie Roll Industry as well as showing the creditor the low level of risk that will be involved. Ratio Analysis of Financial Statement Liquidity |Liquidity Ratios |2007 |2006 | |Working capital |$141754 |$128706 | |Current ratio |3.45 |3.07 | |Current cash debt coverage |1.50 |.93 | Table 1 In the above table, the liquidity ratios of Tootsie Roll Industries reveal that the company has $3.45 in current assets to pay for $1 of the current liabilities. In addition, the cash provided by operation activities include the whole year rather than a balance at one point. Solvency The solvency ratios for...
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...statement Income statement Figure 1 Cash flowproduction cycle (Operating) working capital: movement of cash into inventory Investment: flow from cash into new fixed assets Depreciation: the loss in value of fixed assets ⇒ increase in value of merchandise made + needed for growth Solvency: ability to have cash to buy fixed assets and inventory (outflow cash) The balance sheet Equity= assets - liabilities current assets cash inventories Financial statements: Balance sheet current liabilities ! ! ! long-term liabilities equipment plant ! ! total shareholders equity stock ! long-term debt ! accounts payable ! acc receivable fixed assets retained earnings ! total assets x total liabilities + equity x Figure 2 example of a balance sheet Financial snapshot: 1 moment in time Assets against the claims Liability: obligation to deliver something of value in the future Equity: difference between assets and liabilities Liquidity: speed at which an item can be turned into cash Accounting: income statement Assets and liabilities are listed in order of decreasing liquidity ‐ Current: liquidity 1 year Earnings Before Interest, Taxes, Depreciation, Amortization (EBITDA) -Depreciation, Amortization Earnings Before Interest and Taxes (EBIT) -Interest Earnings before taxes (EBT) -Taxes Net income -Dividends Addition to retained earnings 2 Income statement Difference between 2 important balance sheets ‐ Change in owner’s ...
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...BEAUTY SALON Business Plan BEAUTY SALON Business Plan Contents 1.0 Executive Summary 2 1.1 Objectives 3 1.2 Keys to Success 4 2.0 Company Summary 4 2.1 Start-up Summary 5 2.2 Target Customers 6 2.3 Management 6 3.0 Services 7 4.0 Industry Analysis Summary 7 5.0 Market Analysis 9 6.0 Strategy and Implementation 9 6.1 Competitive Edge 10 6.2 Marketing 11 6.3 Promotional Strategy 12 7.0 Financials 13 7.1 Sales Forecast 13 7.2 Personnel Plan 14 7.3 Start-up Funding 14 7.4 Profit & Net Worth 16 7.5 Projected Profit and Loss 17 7.6 Projected Cash Flow 18 7.7 Projected Balance Sheet 19 1.0 Executive Summary ________ will be a full-service beauty salon. The business is being developed to consistently provide high customer satisfaction through unparalleled service, quality products, and furnishing a friendly atmosphere at a reasonable price/value relationship. We will also maintain a positive, fair, and creative work environment, which respects diversity, ideas, and hard work. The business founder believes that hair should not only compliment one’s lifestyle, but stand out as a main focal point of an individual’s personal style. The ambitions of the founder to one day start her own salon, and the procurement of all the elements necessary to support a salon, has made this business one of great potential. The company's founder, ________________ has been in the beauty industry for the...
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...Acct # | Acct Title | W/P Ref | Last Years (Audited) | Current Years (Unaudited) | 10100 | Cash on Hand | | $1,987.28 | $2,275.23 | 10200 | Regular Checking Account | | $198,116.52 | $532,125.92 | 10300 | Payroll Checkiing Account | | | | 10400 | Savings Account | | $3,044,958.13 | $3,670,599.15 | 11000 | Accounts Receivable | | $16,410,902.71 | $49,780,259.98 | 11400 | Other Recievables | | | $1,000,000.00 | 11500 | Allowance for Doubt. Accts | | -$1,262,819.88 | -$1,254,009.75 | 12000 | Inventory-Spotlight | | $18,825,205.24 | $67,424,527.50 | 12300 | Reserve for Inventory Obsolescence | | -$3,012,000.00 | -$867,000.00 | 14100 | Prepaid Insurance | | $743,314.38 | $3,374,213.78 | 14200 | Prepaid Rent | | $200,000.00 | | 14300 | Office Supplies | | $7,406.82 | $8,540.00 | 14400 | Notes Receivable-Current | | | | 14700 | Other Current Assets | | | | 15000 | Land | | $117,000.00 | $117,000.00 | 15100 | Building and Land Improvements | | $623,905.92 | $674,313.92 | 15200 | Machinery, Equipment, Office Furniture | | $433,217.10 | $2,929,097.13 | 17000 | Accum. Depreciation | | -$164,000.00 | -$610,000.00 | 19000 | Investments | | $612,691.08 | $2,038,780.39 | 19900 | Other Noncurrent Assets | | $13,840.59 | $13,840.59 | | Total Assets | | $36,793,725.89 | $128,834,563.84 | 20000 | Accounts Payable | | $4,633,118.09 | $1,922,095.91 | 23100 | Sales Tax Payable | | | | 23200 | Wages Payable | | $29...
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