tutor2u™ Working Capital Introduction to the Management of Working Capital AS & A2 Business Studies PowerPoint Presentations 2005 Introduction • All businesses need cash to survive • Cash is needed to: – Invest in fixed assets – Pay suppliers and employees – Fund overheads and other fixed costs – Pay tax due to the Government • Nearly all businesses use much of their cash resources to finance investment in “working capital” • Managing working capital effectively is
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Brief Outline This case is regarding Dell computers financial status in the period from 1991 to 1995. In this analysis we intend to highlight the various issues related to working capital experienced by the company. What makes this case interesting is the turnaround of Dell’s financial structure which in turn led to its recovery from seemingly major liquidity issues. To give a brief outline‚ this study enlightens one on how a fast growing company can get into trouble due to mismanagement of cash
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Working capital management is crucial to a company’s goals and planning function. Proper management of working capital can mean that difference between a company’s ability to carry out pre-planned strategic goals and becoming stagnant and losing its competitive edge. A company’s current assets typically end up being its most liquid assets‚ which makes them some of the most valuable when it comes to making corporate decisions. Working capital management is defined as a “managerial strategy focusing
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Clarkson Lumber Company 1. Identify the key problem in the case and explain why it is the key problem. Clarkson Lumber Company’ sales have been growing quickly over the last couple of years. Growths in working capital necessities have surpassed the capacity of the company to produce funds by itself. Also‚ part of the finances was used to buy out a partner‚ further raising the pressure. The company couldn’t appreciate discounts on accounts payable and started borrowing larger funds from the bank
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Working Capital Management Strategies for Improving Working Capital Management by Dorothy Rule‚ Director and Global Head of Liquidity and Investments‚ Citigroup Global Transaction Services n 2004‚ treasurers worldwide continue to strive to manage working capital more efficiently. They are under pressure to reduce Days Sales Outstanding‚ to measure Days Payable Outstanding‚ and to find alternatives for enhancing yield management due to record low interest rates. Other factors are impacting corporate
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"What is a working capital policy and why is it needed?" Working capital is a “measure of a company’s efficiency and its short term financial health” (Ivestopedia‚ 2008). To calculate a company’s working capital subtract its current liability from its current assets. Current assets include cash‚ accounts receivable‚ and inventory on hand. “Working Capital gives investors an idea of a company’s underlying operational efficiency” (Investopedia‚ 2008). A positive working capital ensures that a
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Practice Questions – Working Capital Management Q.1. Spring Enterprises require 30‚000 units of input annually to sustain its production at the current level. The carrying cost is Rs 32 per unit while the ordering cost is Rs 5000 per order. The cost per unit of input is also Rs 32. Determine the EOQ for Spring Enterprises. What would be the firm’s policy of inventory acquisition if the firm’s suppliers offer quantity discount as follows: Order size (units) Discount (%) 3999
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Corporate Finance and Investment 1. Define “Working Capital” Working Capital=Current Assets-Current Liabilities =Accounts Receivable + Inventory - Accounts Payable “Working capital is how much in liquid assets that a company has on hand. Working capital is needed to pay for planned and unexpected expenses‚ meet the short-term obligations of the business‚ and to build the business.” 2. Give concrete measures how w.c. can be optimized (receivable‚ inventories (JIT
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will allocate cases to student groups. Students would submit PPTs in the third week only and from the third week presentations would start. Case Analysis - 30 marks‚ Presentation - 15 marks It will develop team work‚ analytical and presentation skills among students S.No. Registration Number Name Roll Number Group No. Title of Case 1 11401117 Guneet Bagga RQ1410A01 1 Costa Rica case‚ text book p221 2 11403890 Min Kumar Gurung RQ1410A02 1 Costa Rica case‚ text book p221
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PHILIPPINE HISTORY‚ POLITICS GOVERNANCE & CONSTITUTION Lesson Title Lesson Target Reference Title Author Lesson No. Date The Philippines under American Colonial Rule To examine American colonial policies and the legacies of their occupation History of the Filipino People Teodoro Agoncillo Page Number(s) 214-383 I. Benevolent Assimilation Proclamation President William McKinley justified the American occupation of the Philippines by issuing the Benevolent Assimilation
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