StudentShare solutions
Triangle menu

The Lawrence Sports Simulation - Research Paper Example

Not dowloaded yet

Extract of sample
The Lawrence Sports Simulation

There must be: three alternative working capital policies which reduce future difficulties; a recommendation on policy and an evaluation of risk associated with the recommendation; contingencies for the recommendation; performance measures used to evaluate the recommendation; an implementation plan for the recommendation; a discussion and explanation of the recommendation; a review of the cash conversion cycle for Lawrence Sports; an explanation of the importance of the cash conversion cycle to its working capital management; and a conclusion. II. Three Alternative Working Capital Policies Which Reduce Future Difficulties There are three working capital policies which have to be put in place in order to reduce future difficulties as a company. First and foremost, Lawrence Sports must realize that it can’t make more payments than purchases—as it started to do the week of March 31st—and expect to make a profit. Therefore, the company must make a policy to ensure that it is always taking in more money than it is spending. The second thing that Lawrence Sports must do is ensure that all of its vendors are paid in full without leaving capital build up in order to pay off its debts. For example, it was mentioned that Gartner was paid off 40% upfront, and then 60% in the next week. This should not be so. Debts should be paid off quickly and not be allowed to pile up. The same thing happened with Murray, when 15% was paid immediately, with 85% to be paid in the next week—where payments started taking over purchases also during the week starting March 31st. Third, what is most important is that Lawrence try to have a cash inflow total that is at least anywhere from 25 to 50% greater than its outflow. This is just to ensure that the cash inflow does not get too far below so that outflow is not greater, and is a safety measure. III. Recommendation A. The Recommendation on Policy Itself and An Evaluation of Risk Associated With the Recommendation The recommendation made to Lawrence Sports is to do some cash flow analysis—and to emphasize simply having greater cash flow coming in than going out. According to Grier (2007), “Cash, not earnings, allows a business entity to meet its financial obligations. Indeed, assessing the amounts, timing and uncertainty of cash flows is one of the basic objectives of financial reporting and analysis” (pp. 47). This policy will help the company stay solvent. However, this also means that the company has to pay its debts off quickly to these outsourced businesses which provide its products. According to Kakkar (2009), “[One should] [r]educe credit allowances and accelerate cash receipts…” (pp. 234). By reducing the amount of credit used and upping the cash receipts for accounts receivable, this will increase the cash inflow and minimize the risk of coming in below the 25% profit margin that was discussed as one section of the three policy alternatives for the company. This is why cash flow is so important. According to Fight (2005), “Analysis of cash flow, then, cannot merely isolate debt capacity but must also consider all the factors producing major changes in cash inflows and outflows” (pp. 6). Of course, the risk is that by focusing too much on cash flow, the company will neglect other areas. However, this issue is so important because it is what will make or break the company—eventually—is whether or not its ledgers are balanced. B. Contingencies For ...Show more

Summary

SPORTS SIMULATION The Lawrence Sports Simulation: A Recommendation Report Word Count: 1,500 I. Introduction Lawrence Sports is an organization that boasts $20 million in revenue every year. Its chief product distributor is a chain of stores called Mayo, which has locations in the U.S., Canada, South America, and Europe…
Author : sharon53
The Lawrence Sports Simulation essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the research paper on your topic
"The Lawrence Sports Simulation"
with a personal 20% discount.
Grab the best paper

Related Essays

The Rocking Horse Winner by D.H. Lawrence
The 20th century witnessed an explosion of literature that challenged the depths of philosophical and psychological investigation. One of the most prominent writers in the 20th century canon of literature is D.H. Lawrence. Through his novels and short stories he both pushed the boundaries on what is acceptable in literature and explored the subconscious in narrative form within the spectrum of the psychoanalytic understandings of his cultural milieu.
4 pages (1000 words) Research Paper
Economic Issues Simulation
For the efficiency of the health sector, various measures have to be looked at critically. The major changes in the health sector that are vivid today are the cost of the medical care, the ever growing market, the population increase in the world today and most importantly the transmission of health reports and matters to the electronic health records.
4 pages (1000 words) Research Paper
Lawrence Kohlberg
Following the stages of cognitive development suggested by Piaget, Kohlberg’s theory follows in the footsteps to explain how individuals develop into moral beings or rather immoral beings. His theory or proposition of moral development is done in stages, where there are six stages through which one has to go to become a morally mature individual in his or her lifetime.
4 pages (1000 words) Research Paper
Lawrence Paul Yuxweluptun
Lawrence Paul Yuxweluptun has had exhibitions in the US, Canada, Germany, France, amid other places. his work is housed in University collections in Berlin, British Columbia, Zurich, the National Gallery of Canada, the Vancouver Art Gallery, among other places.
5 pages (1250 words) Research Paper
Marketing Simulation

Competition is extremely fierce in the smartphone market. The main competitors are Best Sport, Brandy A1, Super Sport1, H2, and O2. Ocean Blue is the biggest threat since its range of Sports products are the market leaders in Europe. Most people in the other markets also prefer the products to the others.  

5 pages (1250 words) Research Paper
Sports Psychology
Andrew Caruso explains this role of psychology in sports thus: “While no amount of sports psychology will take the place of quality training, intrinsic motivation, and interpersonal relationship with players, research clearly shows that adding the science of sports
4 pages (1000 words) Research Paper
Sports marketing
8). Through sports marketing, the various areas concerning sports achieve their objectives. Specialty firms qualify as the agencies of sports marketing. They
2 pages (500 words) Research Paper
Finance simulation
Captivatingly, the simulation offers a wider perspective of managerial economics as it pertains to the nursing field and decision-making. Changing the skill mix and reducing agency staff were the chosen. Changing the skill mix reduces the
2 pages (500 words) Research Paper
Sports injuries
Concussion refers to a minor form of traumatic brain injury that is caused by blows, pumps, or jolts to the head. It can also be caused by heavy blows on the body that can make the head shake rapidly. It triggers an immediate loss of consciousness that is accompanied by
9 pages (2250 words) Research Paper
Sports Medicine
Sports medicine ensures the early detection of injuries and the right forms of treatment. Most importantly, sports medicine promotes the welfare of athletes and players ensuring that they are not susceptible to injuries and they are not prone to sports-related
10 pages (2500 words) Research Paper
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT
Comments (0)
Rate this paper:
Thank you! Your comment has been sent and will be posted after moderation