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The Case of the Unidentified Industries Essay

Satisfactory Essays
BA 4196 – Section 008

The Case of the Unidentified Industries

A-Department stores- would fit this financial data because their long-term debt stands outs it shows that this department store must borrow a lot of money to finance their inventories and buildings. They have an average inventory turnover rate which means that they currently efficient. This firm overall is at a good pace and its generates a lot of asset. Its shows little signs of any deffieciency except for the many long term debts- and account payable.

B- Retail drug- would fit this financial data because they are just like any other retailer; they would have a quite low collection period- around 2 weeks or so. This also would show why they have a low account
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Additionally the percentage that property, plant and equipment constitute of Total Assets would be large because the organization would need space to store their inventory. Further, merchandise sold online is generally sold on credit or via payment services (eg. PayPal), therefore Accounts Receivable would be large and Receivables Collection Period would be about 2 weeks, the company would be paid by the credit card company/payment service, sometimes before the customer makes a payment to either.

L – Family Restaurant Chain A firm operating in this industry will have high inventory and high inventory turnover. Plant and equipment in a restaurant chain would be more significant than a bookstore or department store because of the type of equipment used in the operation of a restaurant, such as ovens, fryers, freezers etc. Long-term Debt constitutes a large majority of Total Liabilities, which could indicate that this company has financed their equipment with long-term debt. This financial characteristic, coupled with L’s Plant and Equipment, indicates a family restaurant.

M – Airline An organization operating in this industry will have no inventory, and therefore, no inventory turnover. Plant and equipment would be a significant percentage of Total Assets for an organization in this industry as well, as planes, which
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