What positive and negative trends could be determined by a company who has nearly 20% more...
What positive and negative trends could be determined by a company who has nearly 20% more total revenue, 45% less gross profit and 50% less operating expenses than the average of its' 22 competitors over the past 3 years?
Homework Answers
The positive trends are:
- There is an increase in sales as evidenced by 20% increase in revenue
- The company has become more operationally efficient with 50% less operating expenses.
The negative trends are:
- The gross profit has decreased considerably, therefore it may decrease the net income even if the company has reduced operating expenses .
- The company in in highly competitive environment with 22 competitors. For survival it shall undertake much better management
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What positive and negative trends could be determined by a
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a) If you were a creditor, could you give short term
loan to SPRING company? Give reasons, compare with generally
accepted accounting standards, find net working capital and discuss
the Five C's of credit.
b) Calculate the operating cycle for the company and evaluate the
efficiency of the corporation.
c) How could you evaluate the profitability position
of that company?
please explain all details.
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loan to SPRING company?
Give reasons, compare with generally accepted accounting standards,
find net working capital and discuss the Five C's of credit.
b) Calculate the operating cycle for the company and
evaluate the efficiency of the corporation.
c) How could you evaluate the profitability position
of that company?
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please show your work in detail
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