http://california-inn.blogspot.tw/2008/03/butler-lumber-company-case-study.html Butler Lumber Company
本I : b修市場 ( 木材a品，例如T、窗)，^域性的小公司 競爭法 : 用很好的 discount 去吸引生意，K且儘可能的壓低成本 背景 : 合夥人退股，公司跟y行e債$70,000來a原合夥人退股的部份，利息11%；經I的人保守、事必躬H，跟他老婆只有一棟房子；因F金不足，仰賴y行借款 ($247,000)及大量的 trade credit；因為Suburban National Bank 要求real property 作為借款抵押保C，所以Butler 正再尋找一家可借~度大且不用擔保的y行 y行e債 :
1. 1991 spring : Suburban National Bank : $247,000
#y行借X的l件 : 1. 採浮動利率
經濟前景 : 經濟大h境會變的不好，但b修市場仍看好，故aIh境持m看好 =============================================================
總Ya報酬率 ROA : |後bQ / `資產 x 100% = 4.72%] : 用 1990 (net income 44) / (Total liabilities and net worth 933) x 100% = 4.72%
股|權益報酬率 ROE : 稅後Q利 / 股|權益 x 100% = 12.64% ] : 用 1990 (net income 44) / (net worth 348) x 100% = 12.64% ROE=ROA*(`資產/股Fvq)
營收成長 : 1989 -1990 yoy (2694-2013) / 2013 x 100% = 33.8% 1988 - 1989 18.6% ] : I收成L還算不e
U面資料H 1990 p算
流動比 : 流動Ya / 流動負債 = 776 / 535 x 100% = 145% ( 短期償債能力重要指標 ) 速動比 : (流動Ya - 存貨 - 其他Ya) / 流動負債 ( 776-418 ) /535 x 100% = 66.9% (更嚴格的短期償債指標 ) ^低 負債比 : 負債總~ / Ya總~ = 585 / 933 x 100% = 62.7% ^高 下面兩張是 Butler 的 Opearting Statement & Balance Sheet (如看不清楚請按Dcx放大)
討論 : 公司前景ok,但財務控管有問}嗎? aI不e但財務出問}? why? 討論 : 財務配置的比例有問}嗎? cash太少，存貨^多、應收帳款^多嗎? 要怎N解Q? n堂同W提出的解Q方案(班上同W^c)
1. 增Y? 公司有成L性但e債^高(負債比高) 找其他投Y人，公司負責人不找其他投Y人可是本身又o能力可以增Y。 2. 公司Ya流動性不足，一遇周D不`即會倒]--不贊成y行借XoButler ，要改善負債比不只是去尋找新投Y人，也S將公司size down 一c也是一N方法 - Downsize - 存貨p少
- T工p少 因為 expense 增加很快
- 增加N售T 因公司缺乏好的N售T
3. 鼓勵l展新的 Business 已吸引投顧投Y
http://www.termpaperwarehouse.com/essay-on/Butler-Lumber/319525 Butler Lumber
1.&2. Why does MR. Butler have to borrow so much money to support this profitable business? Do you agree with his estimate of the company’s loan requirements? How much will he need to borrow to finance his expected expansion in sales?
According to the given information in the materials, Mr. Butler expects the net sales in 1991 would be 3.6 million. So the expected growth rate will be 3600K/2679Kx100%=33.6%.
EBIT =Net sales-cost of goods sold-operating expense
Assuming the cost of goods sold, operating expense will grow in the same rate, from 1988 to 1991, EBIT of Butler Lumber Company was respectively 50, 61, 86 and 115. The growth rate of EBIT was 22%, 41% and 33.7%. Clearly the company is on a fast growing track.
At the mean time, we need to know if Mr. Butler has enough money to maintain such a fast growth.
Accounts payable in 1991 would be 256K x133.6%=342K
If we assuming the notes payable, accrued expenses, and long-term debt is same with first quarter in 1991, total liabilities in 1991 would be 836K
The net worth in 1991 would be the net worth in 1990 plus the net income in 1991, the net income in 1991 would be 44Kx133.6%=58.8K, so the net worth would be 406.8K. Total liabilities and net worth in 1991 would be 1242.8K .
Total assets in 1991 would be 933Kx133.6%=1246.5K. So there will be 3.7K shortage of fund for the company.
Therefore, Mr. Butler needs to borrow money to reach the expected growth and his estimate of the loan requirements was right. The company needs 3.7K more, which means the total notes payable will increase to 247K+3.7K=250.7K, but Suburban National Bank has a cap of 250K.
3. As Mr. Butler’s financial advisor, would you urge him to go ahead with, or to reconsider, his anticipated expansion and his plans for additional debt financing? As the banker, would you approve Mr. Butler’s loan request, and if so, what conditions would you put on the loan?
First, I will compare some accounting ratios of the company.
Receivables Conversion Period=(Receivables / Net Sales) x 365
From 1988 to 1990, Receivables Conversion Period of Butler Lumber Company was respectively 37, 40, 43 days with the company’s credit...
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