Cartwright Lumber Company I. Company Background & Situation Cartwright lumber company was located in a suburb of a large city in the Pacific Northwest; its operations were limited to the retail distribution of lumber products in the local area. In 1994‚ Cartwright Lumber Company was established as a partnership by Mark Cartwright and his brother-in-law Henry Stark. However‚ in 2001‚ Cartwright brought out Henry’s interest for $105‚000 and incorporated the company. About 55% of the total sales
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The Clarkson Lumber Company Case Analysis June 30‚ 2011 beardsrus Leave a comment Go to comments (Note: In retrospect we think that perhaps Clarkson should reduce its expenses and debt first before leveraging itself further. Exhibits not included here) Written April 19‚ 2010 Finance 434 Overview Clarkson Lumber Company is a classic example of a privately held company that has experienced a rapid growth in sales and has reached a point where it is facing a shortage of cash to
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This gave him power over every step of the lumbering process so he could tightly control costs and profits. By 1900 more than 400 lumber companies including several belonged to Weyerhaeuser were operating in the state and Minnesota ranked third in the nation in lumber production. Towns and cities throughout the Midwest were built using Minnesota lumber. The lumber industry relied on the same basic essentials as the flour industry. Investment from business owners such as Weyerhaeuser was combined
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Clarkson Lumber Case I. Statement of Problem. The basis of Clarkson Lumber Companies problems occurs from their rapid growth in the recent years. Sales have increased by 54.7% from 1993 to 1995; assets have increased by 78.12%‚ while net income has only increased by 28.33%. In order to support these growth patterns‚ Mr. Clarkson has been required to rely on loans in order to have sufficient funds. Also‚ Mr. Clarkson decided to buy out his old partners Holtz’ interest in the company. Clarkson
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Clarkson Lumber Company Solutions Questions: 1.What problems does Clarkson Lumber face? 2.Why does Mr. Clarkson have to borrow money to support this profitable business? 3.Is a line of credit of $ 750‚000 sufficient to meet the firm’s future financial needs? 4.As a banker‚ would you approve Mr. Clarkson’s loan request‚ and if so‚ what conditions would you put on the loan? 1. The Problem Defined: The Clarkson Lumber Company has been expanding rapidly for several years. Increases in working
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1. Why has Cartwright Lumber borrowed increasing amounts despite its consistent profitability? Cartwright lumber has had to borrow substantial amounts of money due to the fact that the firm is a growing company with sales rising quickly. In order for the company to sustain this growth rate‚ they will have to get additional external funding. Growth in sales nearly doubled from 2001 to 2003‚ with a percentage growth of 18% and 34% in 2002 & 2003 respectively. While sales are growing steadily
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Nasirova Aynur Global Finance Case 1: Wilson Lumber Credit analysis on Wilson Lumber as 31.12.1984 Net profit margin Asset turnover Financial leverage RoE RoA 0‚0165 2‚8851 2‚6762 12‚7% 4‚75% quick ratio current ratio debt to equity ratio debt ratio interest coverage ratio 0‚6711 1‚4519 1‚68 0‚63 2‚61 The RoE of the company shows that it generated a 12‚7 % profit on every dollar invested by shareholders in 1984. Taking into consideration that Wilson Lumber is a small company it can be considered average
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Clarkson Lumber Company Financial Analysis 1. Background Clarkson Lumber Company is owned and operated by the hardworking‚ 49-year-old Mr. Clarkson. It has low operating expenses‚ a small staff‚ and strong management. The overall impression is one of a conservative‚ efficient operation. Clarkson himself leads a frugal lifestyle with little personal debt. The company has been in growth during recent years and anticipated a further increase in sales. Despite of consistent profits‚ the company has
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Chef Dan Butler : An Italian restaurant where I worked in Washington‚ D.C.‚ sold a fantastic thick veal chop that we topped with fresh chanterelles and lemon and sage. Nearly every ticket that came into the kitchen had at least one veal chop sold on it. But one particular waiter suggested customers order single veal chops grilled with garlic and rosemary. The garlic and rosemary was a fine preparation but it wasn’t the one that the chef had written nor was it the one that we prepped for. Fortunately
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Soft Wood Lumber and Doman Industries Soft Wood Lumber Disputes Simmered more than 20 years‚ but spilled over May 2002 Dispute from May 2002 to July 2006 Canada’s View Timber is owned by provincial government‚ which charge a ‘stumpage fee’ (charge to cut the trees down) Subsidized because it is used for many industries United States’ View Practice competitive auction‚ and claims Canadian provision unfair Soft Wood Lumber Disputes (con’t) Tentative Agreement reached in April 2006 US would
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