As Beacon Company controller, you are responsible for informing the board of directors about its financial activities.
Question:
As Beacon Company controller, you are responsible for informing the board of directors about its financial activities. At the board meeting, you present the following information.
After the meeting, the company’s CEO holds a press conference with analysts in which she mentions the following ratios.
Required
1. Why do you think the CEO decided to report 4 ratios instead of the 11 prepared?
2. Comment on the possible consequences of the CEO’s reporting of the ratios selected.
2021 2020 2019 Sales trend percent 147.0% 135.0% 100.0% Selling expenses to sales... 10.1% 14.0% 15.6% Sales to plant assets ratio 3.8 to 1 3.6 to 1 3.3 to 1 Current ratio .. 2.9 to 1 2.7 to 1 2.4 to 1 Acid-test ratio . 1.1 to 1 1.4 to 1 1.5 to 1 Inventory turnover 7.8 times 9.0 times 10.2 times Accounts receivable turnover 7.0 times 7.7 times 8.5 times .... Total asset turnover . 2.9 times 2.9 times 3.3 times Return on total assets.. 10.4% 11.0% 13.2% Return on equity.... 10.7% 11.5% 14.1% Profit margin ratio.. 3.6% 3.8% 4.0%
Step by Step Answer:
Related Video
Inventory turnover is a key metric that helps businesses evaluate the efficiency of their operations. A high turnover ratio is generally considered positive, indicating that the company is effectively selling its inventory and making efficient use of its resources. On the other hand, a low turnover ratio may indicate issues such as overstocking or slow sales and may require further examination to identify and address the underlying causes. Businesses use this ratio to make decisions about inventory levels, production schedules, and pricing strategies. It also helps businesses to identify areas where they may need to make improvements, such as reducing lead times for production or optimizing sales and marketing efforts. Additionally, inventory turnover is used by investors and analysts as a key performance indicator to evaluate the financial health and growth potential of a company.
Students also viewed these Business questions
-
sAs Beacon Company controller, you are responsible for informing the board of directors about its financial activities. At the board meeting, you present the following information. After the meeting,...
-
As an analyst for FinCorp Inc., you are responsible for many firms, including ADFC. Currently you have a hold recommendation on ADFC.18 the current price of ADFC is $140. You have conducted an...
-
As a quality control manager, you are responsible for checking the quality level of AC adapters for tablet PCs that your company manufactures. You must reject a shipment if you find 4 defective...
-
Read the article Problem at INSPEECH and answer the question: Why did Inspeech experience a meltdown in 1988?
-
Do the previous problem using the air tables in A.7 The exit nozzle in a jet engine receives air at 1200 K, 150 kPa with neglible kinetic energy. The exit pressure is 80 kPa and the process is...
-
TransWorld Publishing Company completed the following transactions during 2010: Requirements 1. Journalize these transactions. Explanations are not required. 2. What amounts would TransWorld...
-
May (2001) conducted a study of 508 women in the Houston area to identify the skills and attributes those women believed would be needed to succeed in leadership positions in the 21st century. Data...
-
A real-estate broker in Washington, DC, purchased 3 two-bedroom houses in a depressed market for a combined cost of $1,000,000. He expects the cleaning and repair costs on each house to average...
-
A researcher performed a study to assess the prevalence and determinants of breastfeeding in Butler area. She randomly selected four hospitals from the list of all hospitals with maternity clinics in...
-
Is there evidence consistent with gender discrimination in training level? To answer this, proceed as follows: a. Create a table of counts for the two qualitative variables gender and training level....
-
Identify which standard of comparison, (a) Intracompany, (b) Competitor, (c) Industry, or (d) Guidelines, best describes each of the following examples. 1. Compare Fords return on assets to GMs...
-
Use Apples financial statements in Appendix A to answer the following. 1. Using fiscal 2017 as the base year, compute trend percents for fiscal years 2017, 2018, and 2019 for total net sales, total...
-
An infinite plane lies parallel to the yz plane at x = 2 m and carries a uniform surface charge density = 2 C/m 2 . An infinite line charge of uniform linear charge density = 4 C/m passes through...
-
Prepare a cash budget for the months of September and October from the information below. Papa Jos Pizza Place has the following information regarding its business operations: 1. Opening cash balance...
-
What is a question that should be asked about accounts payable when forecasting? What is the cash conversion cycle? How much product on hand is too much? How quickly can we replenish goods? How will...
-
Macon Inc. is looking at setting up a manufacturing plant in Kirksville. This will be a 5-year project. The company bought the land in Kirksville 3 years ago for $4.5 million in anticipation of using...
-
Leeggara Company has an issue of 8-year, 11% annual coupon bonds outstanding. The bonds, which were originally issued 12 years ago, have a face value (FV) of $1,000, a yield-to-maturity (YTM) of 7%,...
-
Write A conclusion on Leadership as a financial manager? with references.
-
The International Morse code is a way of transmitting coded text by using sequences of on>off tones. Each character is 1 or 2 or 3 or 4 or 5 segments long, and each segment is either a dot or a dash....
-
Design and describe an application-level protocol to be used between an automatic teller machine and a bank's centralized computer. Your protocol should allow a user 's card and password to be...
-
Three inventory categories are reported on a manufacturing companys balance sheet: (a) Raw materials, (b) Goods in process, and (c) Finished goods. Identify the usual order in which these inventory...
-
Identify the usual sequence of manufacturing activities by filling in the blank (with 1, 2, or 3) corresponding to its order: _______ Production activities; _______ sales activities; _______...
-
Team members are to coordinate and independently answer one question within each of the following three sections. Team members should then report to the team and confirm or correct teammates answers....
-
Shiraz sold a 1985 Mercedez Benz to Randy for R30 000 subject to a 'Voeststoots' clause. The cars brakes are so faulty that on Randy's first trip they failed, and B crashed into his own garage...
-
A farmer estimates that his dairy cow produces 6,404 L of milk in a year. How many gallons is this
-
enter into the blanks below the BMI / BMI range that matches each BMI classification. In your answer, make sure your answer includes kg/m2. BMI range considered Underweight Question Blank 1 of 6 type...
Study smarter with the SolutionInn App