Financial Performance of Seven Companies - Microsoft, Walmart, Royal Carrobean, Dell, Hp, Tiffany and Applebee
Autor: Jannisthomas • January 4, 2018 • 525 Words (3 Pages) • 603 Views
...
2006-$ millions
Wal-Mart
Target
Costco
Days
Amount
Days
Amount
Days
Amount
Accounts receivable
3.08
$ 2,662
39.30
$ 5,666
2.76
$ 400
Inventory
48.88
$ 32,191
61.01
$ 5,838
31.62
$ 4,015
Operating Cycle
51.96
$ 34,853
100.31
$ 11,504
34.38
$ 4,415
Accounts payable
38.53
$ 25,373
65.50
$ 6,268
33.19
$ 4,214
Cash Cycle
13.43
$ 9,480
34.81
$ 5,236
1.19
$ 201
---------------------------------------------------------------
Operating Cycle
Walmart
DIO = $32,191 / ($240,391/ 365 days) = 48.88 days
DSO = $2,662 / ($315,654 / 365 days) = 3.08 daysOperating Cycle = 48.88 + 3.08= 51.96 days
Target
DIO = $5,838 / ($34,927/ 365 days) = 61.01 days
DSO = $5,666 / ($52,620 / 365 days) = 39.30 daysOperating Cycle = 61.01 + 39.30 = 100.31 days
Costco
DIO = $4,015 / ($46,347/ 365 days) = 31.62 days
DSO = $400 / ($52,935 / 365 days) = 2.76 daysOperating Cycle = 31.62 + 2.76= 34.38 days
Cash Conversion Cycle
Walmart
DIO = $32,191 / ($240,391/ 365 days) = 48.88 days
DSO = $2,662 / ($315,654 / 365 days) = 3.08 days
DPO = $25,373 / ($240,391/ 365 days) = 38.53 daysCCC = 48.88 + 3.08 - 38.53 = 13.43 days
Target
DIO = $5,838 / ($34,927/ 365 days) = 61.01 days
DSO = $5,666 / ($52,620 / 365 days) = 39.30 days
DPO = $6,268 / ($34,927/ 365 days) = 65.50 daysCCC = 61.01 + 39.30 - 65.50 = 34.81 days
Costco
DIO = $4,015 / ($46,347/ 365 days) = 31.62 days
DSO = $400 / ($52,935 / 365 days) = 2.76 days
DPO = $4,214 / ($46,347/ 365 days) = 33.19 daysCCC = 31.62 + 2.76 - 33.19 = 1.19 days
---------------------------------------------------------------
PROBLEM 9.5)
Kocoa Industries
Projected Sales
$ 750,000
Assets- % of sales
90.0%
Liabilities- % of sales
20.0%
Net Margin
1.0%
Dividend payout
0.0%
Assets needed (1) 90% of sales 675,000.00
Spontaneous liabilities (2) 20% of sales 150,000.00
Net Income (3) 1% of sales 7,500.00
External funds needed (4) 517,500.00
EFN= (1)- (2)- (3)
= 675,000 - 150,000 - 7,500
= 517,500
B. In my own opinion I won’t be that much comfortable using the technique above for funding requirements. Although compared to a more detailed strategic financial planning technique, the technique used above is quite simple and less complicated than those of the detailed one but as a financial analyst we wanted to make sure and be accurate of such recommendations we are giving out towards others thus careful and deliberate procedure must be observed to avoid any unwanted situation, thus a fully integrated strategic financial plan should be more prefer.
C. Other information I think which are important to be obtained are of course the financial statements along with the calculated projections or forecast, and the assumptions of the company.
---------------------------------------------------------------
PROBLEM 9.13)
INCOME STATEMENT
Sales
$ 8,800.00
COGS
5,720.00
...