U.S. CORP CASE STUDY
1. In your opinion, what two key changes in the financial statements have occurred? Why did you think the two items that you picked are important?
The main things that has changed in the financial statement are cash in current assets and notes payable in current liabilities. Cash increasing to from 104 to 160 and notes payable decreasing to 196 from 123. Expenses decreased and the income compared to 2001 have increased.
2. What can be seen by the change in the capital structure? Has it improved or deteriorated? Justify your answer by listing the balance sheet items that have improved or deteriorated
Some big changes we can see in cash and accounts receivable comparing to inventory which were increased only by two millions. Also there are some big changes in notes payable on current liabilities side. These changes make good influence on statement because according to numbers this company has improved it`s situation during one year.
3. As part of your examination of the balance sheet, what four things would you like to ask the Management about, if you could? And why?
I would have some questions about long-term debt, inventory, retained earnings and cash. Why long-term debt has such a big changes during one year if company makes big improves. Changes in accounts receivable are much better than in accounts payable but inventory changes only by 2 million this is also a topic to be asked. 4. Make a guess as to what kind of company this is? And why you think this is so?
According to this balance sheet and given numbers I can make a guess that company makes huge financial operations during one year so it must be a corporation. I just can guess that this corporation is producer of some technological products which has a big demand around the world.
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