assiogment, Finance Basics

Assignment Help:
Ask question #MinimQuestion

You are the financial accountant of Donald Bhd, a manufacturer and wholesaler of soft drinks. Donald Bhd is in direct competition with Fizz Bhd and Pop Bhd.

The finance director has informed you that the board of directors are considering purchasing an interest in one of their two competitors in order to increase market share. This decision will be based on forward-looking market and management information. However, the directors seek to use data from recent corporate reports to construct the necessary estimates and forecasts leading to their decision.

The finance director has provided you with the following table of statistics calculated from the most recent financial statements of both competitors.

Fizz Bhd Pop Bhd
Gross profit margin 40% 40%
Net profit margin 15% 10%
Inventories turnover 8 times 4 times
Receivable days 63 days 40 days
Payable days 65 days 65 days
Current ratio 1.25:1 1.75:1
Liquid ratio 0.9:1 1:1
Asset turnover 1.5 times 2 times

Required:

Using the above information, prepare a report for the board of directors’ comparing the results and the financial situation of the two competitors
um 100 words accepted#

Related Discussions:- assiogment

Revenue Reserves - Retained Earnings, Revenue Reserves - Retained Earnings ...

Revenue Reserves - Retained Earnings These are undistributed earnings.  Those reserves are retained for the given reasons like: A. To create up for the fall in profits so a

Value chain, what do you consider to be the main inbound logistics for bank...

what do you consider to be the main inbound logistics for banking

Management of sole proprietorship, Management of Sole Proprietorship  I...

Management of Sole Proprietorship  In sole proprietorship the owner is usually in charge of day to day running of the business. If the business is large he may give some duties

Term structure of interest rates, Term Structure of Interest Rates The...

Term Structure of Interest Rates The term structure of interest rate give details the relationship between the term to maturity and interest rates and the differences between

Explain performance budgeting and zero base budgeting, Write short notes on...

Write short notes on the following: a) Performance budgeting b) Zero base budgeting c) Factors affecting dividend decisions d) Accrual concept

Calculate its operating-financial and combine leverage, The operating and c...

The operating and cost data of ABC Ltd. are: Sales Rs. 20,00,000 Vari

Funding venture capital, Funding Venture Capital Whenever a company's ...

Funding Venture Capital Whenever a company's directors look for support from a venture capital institution, so they must distinguish that as: a) The institution will would

What are the tasks of a financial system, What are the tasks of a financial...

What are the tasks of a financial system? Three Tasks of a Financial System are as follows: 1. Decreasing transaction costs 2. Decreasing financial risk 3. Giving liqu

What is maximal value of firm, Suppose an entrepreneur owns a firm that has...

Suppose an entrepreneur owns a firm that has a production technology that generates the following revenue: R(e) = e 2 +100e where revenue depends on his effort level e. The monetar

What is the role of a broker in security transactions, What is the role of ...

What is the role of a broker in security transactions? How are brokers compensated? Ans: Brokers handle orders to sell or buy securities. Brokers are agents who work in place o

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd