The Financial Detective, 2005

Topics: Financial ratios, Balance sheet, Inventory Pages: 7 (2519 words) Published: August 26, 2011
The Financial Detective, 2005
Financial characteristics of companies vary both from industry to industry and within a single industry for a variety of reasons.   The challenge for any company in planning its strategy is the consideration of the industry’s economics in conjunction with their own strategy to help the company’s financial statements remain strong and competitive across both lines.   In this case, we are asked to use this consideration of strategies to determine which company description belongs to which company’s financial statements.   And explain the differences in the financial results across industries. Case Problems

1. Match the financial statement with the company descriptions. 2. Explain differences in the financial results across industries. Industry| 1st Description| 2nd Description|
Health Products (companies A& B)| This firm is the world’s largest prescription-pharmaceutical company, and has a very broad and deep pipeline of ethical pharmaceutical, supported by robust research and development budget. The company has divested several of its non-pharmaceutical businesses, and become the partner of choice for licensing deals with other pharmaceutical and biotechnology firms| This firm is a diversified health-products company that manufactures and mass markets a broad line of prescription pharmaceutical, over-the-counter remedies, consumer health and beauty products and medical diagnostics and devices. For its consumer segment, brand development and management are a major element of this firm’s mass-market-oriented strategy.| Beer (Companies C&D)| This firm is a national brewer of mass market consumer beers sold under a variety of brand names. It operates an extensive network of breweries and distribution systems. Also own a number of beer related businesses – snack, aluminum container manufacturing and theme parks | This firm produces seasonal and year-round beers with smaller production volume and higher prices. This firm outsources most of its brewing activity, and financially conservative. | Computers (Companies E&F) | This firm focuses exclusively on mail-order sales of built-to-order PCs, including desktops, laptops, notebooks, servers, workstations, etc. It’s an assembler of PC components manufacturer by its suppliers. This firm allows customers to design, price and purchase via its website. | The company sell in highly differentiable line of computers, consumer-oriented electronic devices, and variety of proprietary software products which led by charismatic founder. It has begun to recover from a dramatic decline in its market share. The firm has an aggressive retail strategy intended to drive traffic via base stores and expand its installed base of customers by showcasing products in a user-friendly atmosphere.| Book and Music (Companies G&H)| One focuses on selling primarily to customers via a vast retail-store presence. This firm is the leader in traditional book retailing which fosters through its “community store” concept and regular discount policy, also maintains an online presence and owns a publishing imprint. | This firm sells books, music, and videos solely through its website, which more than three-quarters of its sales are media, also sells electronics and other general merchandise. And it become profitable and it has followed an aggressive strategy of acquiring related online businesses. | Paper Products (Companies I& J)| The firm is the world’s largest maker of paper, paperboard and packaging. This vertically integrated company owns timberland; numerous lumber, paper, paperboard and packing – products facilities; and a paper distribution network. The company has spent the last few years rationalizing capacity by closing inefficient mills, implementing cost-containment initiatives, and selling nonessential assets.| This firm is a small producer of printing, writing and technical specialty papers, as well as towel and tissue...
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