Acf Case O.M. Scott & Sons Company Essay

The company has been functioning well in terms of generating profit and demand so far. However, there will be a 20% increase in demand for the next month of operations as predicted by management, and the production and supply management's problems may come as a problem they can no longer afford.

At the time of this case Target’s main strategic goal was to stay in line with domestically opening 100 new stores per year. The acceptance of new projects were considered on the basis of this underlying goal. NPV and IRR were key measures in the financial analysis of each project. Adherence to the capital budget was another main goal of CEC. If projects exceeded the initial budgeted outlay then the firm would have to borrow money. This could be a concern to shareholders in that it adds debt and questions the competencies of managements budgeting forecasts.

Review of ABC Company and the directions it is targeting. The strategy of the company is to lift the expected sales in an aggressive fashion, with the expected end target being to triple the current levels. The plan is to push sales into the targeted range of $3 million within 3 years versus the current amount which sits at $1.2 million. We will identify the perceived risk factors that may impact this aggressive strategy and its successful execution. The following will be those risk factors:

Thank you for the opportunity to assess your sales data in order to provide recommendations for increasing your sales. The analysis and recommendations below are based on the data you provided, which covers a period from May 2004 through June 2006. The analysis below is based on this data alone. Therefore, our recommendations should be tempered by your knowledge of business realities and your market. Please let us know if we can answer any questions concerning the analysis or the recommendations provided.

Although the company seems to be profitable, it has faced shortage of cash. It happened due to increase in Accounts Receivable as well as Inventories. On the other hand, Accounts Payable does not increase that rapidly and difficulties regarding cash collection become evident. Furthermore, the cash collection cycle becomes larger (59 days in year 2003, while more than 70 in year 2006).

The accounts-payable policy Maggie Brown has adopted will not be sustainable in the years to come as they have a massive liquidity problem at hand. The suppliers have credit terms allowing them 30 days to payback for purchased goods, and Maggie should be taking advantage of that.

Referring to Vice President of Finance, he want to pursue the current approach because they are in profitable based on contribution margin by 35 percent. The company just needs to monitor their margin in control their cost well.

Thanks to a lucky series of events, Atomic Company has enjoyed a sharp increase in sales of their Tiger Pants line. The most obvious and immediate pains being felt by management is the inability to predict future sales and the high amount being paid out in sales commissions. While these are legitimate concerns, I believe deeper problems exist.

On December 31, draw a large check against one of the company’s bank accounts and deposit it in another company’s accounts in a different bank. The check won’t clear the first bank until after year-end. This will substantially increase the amount of cash in bank accounts at

Tighten up collection of receivables so that receivables account for less than 19% of Sales (1985). Pursue more aggressive strategy of collections;

1. It is a fact that item 345 has lost market share and as the product manager I would be concerned about it. By retaining FF20 price I can gain market share only if competition increases their price to FF20. At the outset this seems unlikely because competition has

11. Accounts receivable turnover and days sales in accounts receivable for the last three years:

When USAA started in 1922, they were a property and casualty insurance company however, with time they expanded their services to their members and became a financial institution.

Nonetheless, an improvement in age of receivables for a single company over multiple periods suggests a company is becoming more efficient or effective at managing its receivables (Bujaki & Durocher, 2012; Gibson, 2011).

The proportion of the total dollar amount receivable I included in the confirmation request is in “Account Receivable Aging Analysis” by diving the total amount that is collectible “C” by the total amount of sales. The result is 82% ($9,803,430/$11,920,028) of the total dollar balance in accounts receivable.