considerable negative connection between gross operating returns and the amount of days accounts receivable‚ supplies stock and accounts payable of companies. On the root of these outcomes it is recommended that directors or executives could generate significance for their stockholders by dropping the quantity of days’ accounts receivable and inventories to a sensible lowest level. The direct opposite connection between accounts payable and profitability is steady with the analysis that lower profitable companies
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in NP. In order to analyse: The NP margin reflects the expenses of a business. A low or declining NP margin (especially when the GP is relatively high) suggests excessive costs. A high NP margin suggests low costs/expenses and sound financial management. A low or declining NP margin suggests that expenses should be examined to see whether reductions can be made (e.g. staffing costs) Some authors feel a 10-12% NPR is ‘good’ The higher the NPR the better Return on Owners
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of July until 31st of July‚ 2014. The first part of the report offers an overview of the organization‚ and then describe the process which has been implemented by finance department according to the policy which has been approved by the higher management represented by the university president and the Vise president of finance and administration. Finally the report wraps up with a few closing remarks and conclusions from the experience. The American University of Lebanon is a non-profit institution
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costumer. Then‚ the warehousmen will submit their inventory reports to the CLGM office. The quantinty of the products to be supplied by the Asia Wide Refreshment Corporation depends upon the number of empty bottles. Furthermore‚ the warehousing management under CLGM is using manual system in doing transactions and operations‚ particularly sorting of products‚ financial statement and praparing of summary reports of sales representatives. The operations goes round in receiving of new stocks from the
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next few years. The problems with Ocean Manufacturing are their lack of experience in management and their frustrating new IT system. The reason behind the lack of experience in management is due to the resignation of the vice president of operations and of the controller. They both took jobs in other cities due to personal issues. The IT system maintains integrated inventory‚ accounts receivable‚ accounts payable‚ payroll‚ and general ledger software modules. It was handled mainly by the former
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Chapter 7 Inventories 6. Ending inventory is made up of the oldest purchases when a company uses a. first-in‚ first-out b. last-in‚ first-out c. average cost d. retail method 11. The inventory method that assigns the most recent costs to cost of goods sold is a. FIFO b. LIFO c. Average d. specific identification 12. Inventory costing methods place primary emphasis on assumptions about a. flow of goods b. flow of costs c. flow of goods or flow of costs depending on the method d. neither flow
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from its receivables and by selling inventories. ACID-TEST RATIOS Quick Asset = Current Assets - Inventories Acid-Test Ratio = Quick Assets /Current Liabilities | | 2010$000 | 2009$000 | Current Assets | 89‚725 | 67‚653 | Inventories | (26‚218) | (22‚605) | Quick Assets | 63‚507 | 45‚048 | Current Liabilities | 82‚832 | 59‚320 | | 0.8 : 1 | 0.8 : 1 | The traditional rule of thumb for this ratio has been 1:1. Anything below this level requires further analysis of receivables to understand
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Internal Control and Risk Evaluation Since offering suggestions for Kudler earlier this month‚ the request has been received to analyze the risks involved. Suggestions included: improving functions of inventory‚ accounts receivable‚ accounts payable‚ and the payroll system with any company. When inventory is involved‚ it is important to maintain accurate records. This will be done for Kudler through automation‚ enhancement‚ and maintenance of the inventory. The risks involved in this change
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performance of the company‚ when they are the look to see if the projections are dependable and conservative. They also want to see if the assumptions are within an individual’s control‚ such as the wage an individual would expect to earn or if management can make decisions which could affect profit. It almost goes without saying that we want to see past data is reliable. Banks don’t want to make a million dollar loan to an individual who only makes twenty thousand dollars a year or based on
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1. By way of confirmation of year-end accounts receivables‚ auditors hope to verify management assertions regarding the “Existence” of said accounts receivables and its true “Valuation”‚ AU330.12. Year-end sales cut-off test is another important audit procedure‚ which gives the auditor information on the “completeness” of a sale. The aim is to make sure that whatever sales are being recorded is recorded in the correct period. 2. Cooper & Lybrand did indeed made mistakes & errors. First
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