Hampton Machine Tool

They may have to do that since the company's predicament indicates partly that "the bank doesn't understand Be Our Guest's business"�. Exhibit 2 shows a list of what the company cannot do in terms of the loans it has with State Street. All of these covenants, like prohibiting two consecutive quarters of net losses and not incur a net loss for any fiscal year, suggest further that Be Our Guest may need to find another lender who will not be as strict with its terms.�

Be Our Guest’s balance sheet shows good signs of liquidity. Current Ratios for the past four years have remained above 1 proving that the company can handle its current liabilities. The current ratios are not extremely high (19941.27, 1995- 2.17, 1996- 1.15 and 1997- 1.16), but they can cover the current liabilities. It is important to note that the company is operating on a thin line because the current assets are barely covering the current liabilities. This is particularly unpleasant because we are dealing with a company operating in a seasonal business. It is a concern that the current ratio slightly eroded after 1995, and this is primarily due to Be Our Guest converting the bank line into long term debt in

The company have generated very low operating cash flows, which is caused by a negative net income(16, 55) in 94,95, again with sales going down and cost of goods sold increasing. The company current ratio (2.3, 2.1, 2.5) in 93, 94, 95 are indicating satisfactory but when analyze quick ratio (1.1, 1.1, 1.3), and we also know that sales are down which mean more inventories. Now the account payable days has been increasing (49, 62, and 66). They have been delaying there payment which mean more cash on

Why can't a profitable firm like Hampton repay its loan on time and why does it need

The company has an agreement with a bank that allows the company to borrow the exact amount needed at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. At the end of the quarter, the company will pay the bank all of the accrued interest on the loan and as much of the loan as possible while still retaining at least $50,000 in cash.

The company’s debt position shows that there was rapid increase in Butler Lumber’s accounts and notes payable in the recent past, especially in the spring of 1991. This kind of notable increase of current liability should account for the increase mentioned above, which indicates the company’s great need of short-term funds.

Why can't a profitable firm like Hampton repay its loan on time and why does it need

In 2006, 46.32% of the claims on the business (apart from those related to working capital) have been provided by outsiders. They did not create enough profit to cover their interest expense for the year as this figure was minus 4.69 times. It would take the company 2.49 years to pay back all their liabilities.

Answer: Aging schedules definitely help a company keep track of which of its customers are paying on time, and are useful in figuring cash flow. In this case, it is apparent that the majority of accounts receivable by the end of March are less than 30 days old (80.8%). By the end of June, that percentage goes down to 63.7%. By the end of March, 19.2% of accounts receivable are between 30-60 days old, and by the end of June, there is 36.3%. 0% of accounts receivable get to be over 60 days old, which indicates payment.

2. Forecast the firm’s financial statements for 2002 and 2003. What will be the external financing requirements of the firm in those years? Can the firm repay its loan within a reasonable period? In order to forecast the financial statements of 2002 and 2003, the following assumptions need to be made. The growth of sales is 15%, same as 2001, which is estimated by managers. The rate of production costs and expenses per sales is constant to 50%. Administration and selling expenses is the average of last 4 years. The depreciation is $7.8 million per year, which is calculated by $54.6 million divided by 7 years. Tax rate is 24.5%, which is provided. The dividend is $2 million per year only when the company makes profits. Therefore, we assume that there will be no dividend in 2003. Gross PPE will be $27.3 million (54.6/2) per year. We also assume there is no more long term debt, because any funds need in the case are short term debt, it keeps at $18.2 million. According to the forecast, Star River needs external financing approximately $94 million and $107 million in 2002 and 2003, respectively. In order to analysis if the company can repay the debt, we need to know the interest coverage ratio, current ratio and D/E ratio. The interest coverage ratios through the forecast were 1.23 and 0.87 respectively, which is the danger signal to the managers, because in 2003, the profits even not

The anticipated expenses is estimated according to the size of the company, initially the company will have one employee, and the owners will take care of the fulfillment of the orders at the first stage, this strategy is to reduce initial costs at the beginning of its operations. Therefore, the owners temporarily will not have salaries, which can take up to four month or more depending of the company financial performance.

The helpful hammer is a simple machine that is easy to use. The helpful hammer includes a lever, which affects the effort, or force, needed to do a certain amount of work, and are usually used to lift or move heavy objects. All you have to do is have a nail and a little bit hammered in so that the nail will be able to stand up on its own. Then, push the hammer down so that the rubber bands will act like a slingshot. Release, and the rubber bands/slingshot will get the hammer into an upward position and the weight in front of the hammer will bring the hammer down with force that will then cause the nail to go into the wooden

Monmouth Inc. is a leading producer of engines and massive compressors used to force natural gas through pipelines and oil out of wells. It is has dependence on sales to the oil and gas industries, the earnings of which is fluctuated owing to cyclical nature of heavy machinery and equipment sales. Anyway, the company’s amount of earnings growth and sales are above average in long-term view. From the last three acquisitions the company adhered to only leading companies in their respective market segments. The fourth company on the list of acquisition was Robertson Tool Company.

Such rate suggests for the banks and suppliers that the company is low risk for investment and has high liquidity, but also proposes that the cash is being accumulated to finance future aircraft orders or other investments. The fact that the cash reserves has grown with €1.2bn in the last two years also underpins these assumptions.(Morrell 2007)

At Quick Stab Collection Agency, we value the ability to collect overdue bills from small residential & commercial accounts, and our goal is to achieve profitability growth while being able to avoid risky options. In order to maintain our company’s profitable growth in the upcoming future, I have analyzed the data on the relationship among variables: DAYS-the number of days to collect payment and BILL-the amount of overdue bills in dollars; and the additional two type of accounts given 1 being Residential and 2 being commercial. Below are my findings.