Assessing How Well Companies Manage Their - Essay Example

Only on StudentShare

Extract of sample
Assessing How Well Companies Manage Their


If a firm pays its bills with a 30-day delay, 2/3 of its purchases will be paid for in the current quarter. 5/6 of its bills will be paid for in the following quarter. If its payment delay is 60 days, 1/3 of its purchases will be paid for in the current quarter. 2/3 of its bills will be paid for in the following quarter.
The vice president's proposal of accepting consumer credit cards yields a higher contribution of $1,152,000 as compared to the sales manager's proposal of looser credit policies that yields a contribution of only $590,000. Therefore, Moorer Corporation would be better off under the vice president's proposal. Credit sales should not be abolished. Though credit sales would result in uncollectible accounts receivable, abolishing credit sales altogether would result in lost sales that might be more than the uncollectible accounts receivable. This is because it is common practice nowadays, especially in the sale of luxury consumer goods.
1. John Burton should develop a JIT inventory system. A JIT inventory system reduces in-process inventory and its associated cost (Just in time, n.d.). JIT manufacturing means making a good or service only when the customer, internal or external, requires it (Atkinson et al., 1996). The process is driven by a series of signals, or Kanban, that tell production processes to make the next part. ...
Download paper

Summary

Hickory Company is managing its receivables better in 2006 than it did in 2005. The accounts receivable turnover ratio is higher in 2006 than in 2005. This means that the company is using its asset-average net receivables more effectively in 2006 than it did in 2005…
Author : lebsacknoemy

Related Essays

Assessing Corporate Governance in the Real World
Corporate governance refers to the structure which ensures that the right questions are asked and checks and balances are in place to make sure that the answers to these questions reflect what is in the best interest of the organization for long-term sustainability of value (Minow & Monks, 2008)....
8 pages (2008 words) Essay
How to Manage Diffrent Groups In Leisure Industries
Many management authors that effective management of people is the most important trait of a successful manager have underlined it. In leisure industry we find people who are the obvious elements like- mangers, employees and clients. Then there is another set of people who are indirectly related like the performers, spectators, technicians etc....
8 pages (2008 words) Essay
How to Manage Emotions in Airport Customer Services
The most global definition of emotion draws from systems theory, identifying emotion as a multiattribute process that unfolds over time, with the attributes unfolding at different rates (Paynee & Cooper 2007). Emotions attributes are manifest in multiple channels (experiential, physiological, expressive, cognitive, and behavioral), and the channels themselves are loosely coupled such that measures of different emotion attributes (such as self-report and physiological) may not correlate highly. Following McDonagh et al (2003): 'The cognitive, functionalist position on emotion posits that...
10 pages (2510 words) Essay
Differences in Assessing and Managing Credit Risk in Investment Banking and Commercial Banking
Credit risk represents the possibility of loss due to the inability of the obligor to fulfill the terms in the financial obligation (bond, note, lease, installment debt etc.). The credit risk is known by slightly different terms in investment and commercial backings. Counterparty credit risk is important for investment banking mainly in trading operations and loan credit risk is crucial in commercial banking. Though both may be caused by the same reason, default, they are managed differently. Credit risk becomes a very serious issue if accompanied by poor banking operations. Proper systems and...
7 pages (1757 words) Essay
Multinational Companies
Multinational companies have previously enjoyed the benefits of competitive advantage in the respective markets as a result of their ability to position themselves in the market and exploit resources. However, the values of competitive advantage are under threat as a result of increasing competition, and also the volatility in the market. For example, clothing companies were able to exploit the low cost labour market in some parts of the world, but improved communication links and the Internet have resulted in public outcry over perceived exploitation. The countries involved in supplying these...
14 pages (3514 words) Coursework
How do international financial institutions manage the change needed after the 2008 financial crisis?
The main aim of regulation is making the reporting system transparent so that the market participants can have a better idea about the risk that they are undertaking. The above mentioned financial crisis was mainly attributed to insufficient regulation therefore a change in the regulatory framework is needed to avoid this in the future. An important official of the IMF has attributed regulatory failure to guard against excessive risk as the reason of the 2008 financial crisis. However excessive regulation is also one of the reasons that contribute to the financial crisis. As per the Basel II...
16 pages (4016 words) Essay
Manage
To retweet (verb) intends to send another persons tweet to the followers (Mann & Stewart, 2011). Retweeting is a typical action on Twitter and mirrors the ubiquity of individual tweets....
4 pages (1004 words) Essay
Got a tricky question? Receive an answer from students like you! Try us!