The first thing is that there could be some uncontrollable changes and the second is that the companies are not comparable in size, Large businesses have the advantage of economies of scale.
Based on the analyses, Karen should recommend the extension of the existing short and long term loans and grant the additional We feel the loan should be given because the projections show substantial improvement in many areas of the financial statements.
Accounts payable and receivable both show improvements while the ratios continue to recover and regain strength. Similarly, Mark company executive summary essay gross profit margin and the return on total assets has decreased over the past three years, the gross profit margin dropping from We perform a sensitivity analysis to show how sensitive the results are to things such as the sales growth rate, the cost of goods sold percentage, and the administrative expense ratio.
One of the major factors in the possible denial of the new loan is the lack of payments on their short term loans. Weaknesses we found in Mark X were its debt ratio, which increased from However, they would need to collect the entire amount in under 10 days to pay the bank back.
In the situation of a recession, there is nothing that the company can do about it. There is a potential that the bank could withdraw its line of credit and demand immediate repayment of the two existing loans. The ratios should be used to measure areas that are controllable by them.
The Alton Z score of Mark X is projected to rise well above the industry average reducing their chances of bankruptcy. This may make it possible to lay blame on the wrong reasons and not properly evaluate the state of the company.
Finally, their profitability ratios are showing that their ability to generate profit is decreasing. The liquidity ratios show that not only does Mark X have problems obtaining cash, but these problems have been getting worse.
For example, a large company can have larger earnings per fixed asset because they have a much larger market share than a small company that uses the same technology.
Mark X could pay off their outstanding short-term loans by the end of Sales generated from the fixed assets are greater than the costs of the fixed assets, which imply that the fixed assets that were purchased are good investments for the company, This is really the only positive ratio they have at the moment.
Notice that their current assets consist Of a very high percentage of inventories.
The inventory turnover ratios have decreased as well as the total asset turnover. The leverage ratios show that their debt levels are not only extremely high, but they are only getting worse. If the bank were to demand immediate payment Of all outstanding loans, Mark X would have a real mess on their hands.
The sensitivity analysis is a technique that indicates how much NP Will change in response to a given change in an input variable, other things held constant. If that happens, Mark X has very limited plans of action.
The profit margin ratio also fell from 5.
This will make the task of converting its current assets into cash in a short period Of time difficult. Looking at the data from Gigs-l egg, eve feel that the bank should not lend the requested money to Mark X. You should also be careful comparing different years without taking the state of the economy into consideration In recessions, it would not be smart to compare the earnings per share to a previous year before the recession.
The return on equity using the extended DuPont Equation shows how the ROE was inand quickly fell to I inwell below the industry average. Both ratios are steadily decreasing, indicating to us the position of the company has become less and less favorable.Running head: EXECUTIVE SUMMARY Executive Summary Hilda C Benitez Grand Canyon University NRS Nursing Leadership and Management August 12, Executive Summary It is a well-known fact that obesity continues to burden the healthcare industry.
According to the reports made by Center for Disease Control and Prevention.
The company’s asset management ratios also show decreasing numbers. The inventory turnover ratios have decreased as well as the total asset turnover. This explains the number Of times a company’s inventory is sold and replaced during a period. The company’s days sales outstanding (CAP) also rose from 00 in to 99 in HOME Free Essays Johnson and Johnson Executive Summary.
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A Strategic and Tactical Approach to Global Business Ethics. COMM Course Outline. Business Writing Guide Executive Summary and Research Essay Outline Assignment This assignment has four parts. III. Outline of Essay Following the Executive Summary, please develop an outline of your research essay.
This outline 5/5(1). Analyzing Mark X Company’s financial statements and projecting the expected numbers for the coming years we make a decision on whether or not Mark X Company qualifies for the loan extension of $6, The strength of Mark X as a company is its fixed assets turnover ratio, which rose from to Executive Summary: Mark X Company is the maker of farm and specialty trailers.
The company has fallen on difficult times and wants their bank, Wells Fargo, to extend a loan for working capital and an expansion of their current facilities.Download