The Internal Assessment focuses on identifying and evaluating a firm’s strengths and weaknesses in the functional areas of business, including: management, marketing, finance, production, research and development, computer information systems.
There are many subareas inside these functions, such as customer service, warranties, advertising, packaging, and pricing under marketing.
The functional business areas differ for different types of organizations, such as hospitals, universities, government agencies and so on. In a hospital, for example, functional areas may include cardiology, hematology, nursing, maintenance, physician support…
Functional areas of university can include athletic programs, placement services, housing, academic
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c) cash ratio = cash / short-term liabilities
What is measured: How many Euros of cash cover 1 EUR of short-term liabilities.
2) Leverage ratios
a) debt to total assets ratio = total debt / total assets
What is measured: How many percents of total funds (capital) are provided by creditors
b) debt to equity ratio = total debt / equity equity = total liabilities – liabilities
What is measured: The percentage of total funds provided by creditors versus by owners
c) times interest earned ratio = profit before interest and taxes / total interest from credit
What is measured: How many Euros of profit cover 1 Euro total interest
3) Activity ratios
a) inventory (stock) turnover = sales (return) / inventory (stock)
What is measured: How many times are inventories changed into other forms of current assets? The bigger number is better than smaller number.
Whether a firm holds excessive stocks of inventories and whether a firm is selling its inventories slowly compared to the industry average.
b) current assets turnover = sales (return) / current assets
What is measured: How many times are cash changed into cash again.
Cycle of current assets:
Cash –> material (wood, glass…) –> finished products –> claims (receivables) –> –>cash
c) The length of time of current assets turnover = 365 / current assets turnover
What is measured: how many days takes cycle of current assets.
The smaller number is better
| How would your answer to (a) change if you anticipated no growth in cash flow? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
The functional areas in any business can’t work alone; they must interact with other departments and have good communications within them.
In all companies there are many different tasks which need to be carried out regularly, in order for the business to reach its aims and objectives. Stock needs to be brought, the bills and finances need to be controlled, and customer service issues dealt with and so on. In a small organisation one or two people may do all the jobs, whereas in a large organisation people have to be specialized in many different individual tasks. In a large company it is easier to identify the separate functional areas, because groups of employees would work together in departments. Each department carries out its own individual tasks to relate to their specific area. The main purpose of functional areas
When calculating the percentage change in inventories, an issue arises when using either the lower cost of market or the market value. When looking at the calculations for finished goods inventory (insulated wire) and copper rod inventory Laramie has applied the lower cost of market. However, the calculation pertaining to plastics inventory reveals that the market value should be used for classification, but Laramie has used cost. The percentage change of the plastics inventory if the $.12 per pound is used is a 27% decrease. The importance of classifying inventory correctly
The reliability of an assessment in a perfect situation should produce the same results if marked by another tutor or if that examiner unknowingly receives the same paper again. If different marks are given the assessment is consequently unreliable and proves that this assessment is subjective.
year 1 net income would do). Then, its year 2 opening net assets are $276.36,
|Ratio |Numbers from Arcadia financial |Result |Is it a liquidity, |Define the ratio and explain what the result shown in Column 3 means to the organization. Do not forget to |
A. The interest rate to use is the nominal rate, assets are the discounted sum of their future values, and expected
c) Compute for 2005 and 2004 the (1) debt to total assets and (2) times interest earned ratio.
Self-assessments can be a personal benefit, as they allow one to better understand how they communicate, how they form relationships, and even how they learn. They are tools that help people comprehend aspects about themselves that they weren’t initially aware of. The Myers-Briggs Type Indicator, the Johari Window technique, and the Pillow Method are examples of these assessments. In this paper, I will use these three self-assessments to analyze and explain the ways in which I communicate and interact with people.
Select a location and observe the counting of the physical inventory to examine if the percentage of inventory value the management comes up with is reasonable.
c) What is the implied DSO at the end of March? At the end of June? What is the relationship between the DSO and the average collection period?
The internal environment consists of the inherent competencies of the firm and the structure of its internal systems and processes. It is imperative for the organization to conduct an internal analysis
inventories of finished goods, or whether less was produced than sold, which would mean a
Inventory represents the current amount of goods/products that a company has in stock. The inventory levels usually fluctuate due to the sales rate of a product. Inventory levels determine the increase or decrease in the production for a manufacturer or to order more or less of the product, if it is a stock item for a retail store. Inventory is usually a business’s largest asset and inventory decisions constitute a delicate balance between shortage costs, holding costs and ordering costs. Most companies have a base stock and a safety stock in their inventory. There are various reasons for inventories to fluctuate: