alternatives: • Debt to Equity Ratio of 1.23 more than 1 reveals that more than half of assets are financed by debt. • $3.6 million required for repairs of hull before 2013. • Gross profit of 60% has not increased much over past three years it will affect operating income if there is a decline in sales. • Operating profit of .23% in 2012 seems to decline from 2011 of .26% implies company earns less per dollar of sales. • Accounts Receivable of 2.6 days in 2012 increased as compared to 2.3 days
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Track Software Inc. Case Study Assignment 1 Prof. DelPiano ACCT3020 10/1/2014 De’ Vonte Watson Kristina Bridges Daniel Bell A. 1.) Stanley’s financial goal he seems to be focusing on is maximizing profits. This is the correct goal because the goal of any firm and therefore its financial manager‚ should be to maximize its value and by extension the wealth of the shareholders. 2.) There is potential for an agency problem if Stanley decides to go ahead and invest in the software
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CASE ENAGER INDUSTRIES 1.0 Performance Measurement In today’s advanced and rapidly changing manufacturing environment‚ operational performance measures are taking on ever-greater importance. It is due to the influences of worldwide competition‚ just-in-time inventory management‚ and an emphasis on product quality and customer service. A multidimensional conceptualization of organizational performance related predominately to stakeholders‚ heterogeneous product market circumstances‚ and time.
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Name Chapter 4--Profitability Analysis Description Instructions Modify Add Question Here Question 1 Multiple Choice 0 points Modify Remove Question One important difference between return on assets (ROA) and return on common shareholder’s equity (ROCE) is Answer ROA does not differentiate based on how a company finances its assets‚ ROCE does. ROA does not distinguish between the different types of income items‚ such as income from continuing operations‚ discontinued
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1 Q. Using suitable examples define barriers to entry. Explain how barriers to entry affect our firm’s profits. Before a firm can compete in a market‚ it has to be able to enter it. Many markets have at least some impediments that make it more difficult for a firm to enter a market. A debate over how to define the term “barriers to entry” began decades ago‚ however‚ and it has yet to be won. Some scholars have argued‚ for example‚ that an obstacle is not an entry barrier if incumbent firms faced
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2) Explain why a profit maximizing firm produces the output that equates marginal revenues to marginal costs (MR=MC). In a perfectly competitive market‚ producers are price-takers and consumers are price-takers. There are many producers‚ none having a large market share and the industry produces a standardized product‚ also free entry and exit of the industry. They produce using the optimal output rule: produce where marginal revenue equals marginal cost as Smith (1904) demonstrated. Figure
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When researching the price of virtual styling applications the prices vary. Larger companies did not charge a price for their applications and website subscripitions while unknown companies did. The price of my product will be priced around $9.99. The other applications do not offer virtual styling services‚ they only offer style recommendations and fashion updates. I believe that 9.99 is a good price to offer for the application. I would also consider going a bit higher‚ around $15.00 for the application
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five orders‚ using the cost driver information and its existing costing system: (1) The ABC system: Order 1 2 3 4 5 Sales $610.00 $ 634.00 $6‚100.00 $6‚340.00 $6‚100.00 Cost of goods sold 500.00 500.00 5‚000.00 5‚000.00 5‚000.00 Gross margin $110.00 $ 134.00 $1‚100.00 $1‚340.00 $1‚100.00 Cost of : entering electronic order1a $ 3.50 $ ¡Ð $ 3.50 $ ¡Ð $ ¡Ð entering manual order1b ¡Ð 7.88 ¡Ð 31.50 31.50 processing cartons2
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Theories of Profit There are various theories of profit‚ given by several economists‚ which are as follows: 1. Walker’s Theory of Profit as Rent of Ability This theory is pounded by F.A. Walker. According to Walker‚ “Profit is the rent of exceptional abilities that an entrepreneur may possess over others”. Rent is the difference between the yields of the least and the most efficient entrepreneurs. In formulating this theory‚ Walker assumed a state of perfect completion in which all firms are
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analyse and outline the company’s profitability‚ liquidity‚ solvency and investment potentials based on 15 ratios. All information is taken from the Next plc 2011 statement. Profitability and Performance The gross profit ratio indicates that Next plc was able to maintain their gross profit. It has decreased insignificantly by 0.05%. In 2011 the revenue has increased by roughly 47 Million‚ hence the sales of costs increased proportionally to this. The reason for the increase could be either an introduction
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