For the quick ratio, it is even lower which deducted from the inventories which are considered as not easy to liquid, therefore, it can be significantly that Star River has big short- term liquidity problem. The other important factor to include would be the level of debt required for the machines to achieve the desired results. Flayton Electronics has faced a severe risk that can jeopardize the integrity of the business leaving it open to lawsuits from customers, banks, or investors. Offices in Boston, Los Angeles, and Houston are in the planning stages. According to the forecast and analysis, it seems Star River cannot repay its loan within a reasonable period.
The difference between the two ratios continues to increase from. When financing these expenditures, we feel they should lean more heavily toward equity and the use of more long-term debt as opposed to short-term debt. Star River survived a period of consolidation, and now faced a new threat. Avoiding an unnecessary purchase of a fixed asset will result in less capital expenditure and less depreciation expense. Historical Analysis: Ratio analysis: For historical analysis we have provided a ratio analysis of 4 years and showed a trend for next 2 years on the basis of these ratios. Financial Forecast of Star River Electronics Ltd. Some of this stems from the organizational structure.
Efficiency and Leverage Ratios 1998 1999 2000 2001 Inventory Turnover Ratio 1. This, also, shows that they are over leveraging themselves and creating excessive default risk. From the data to assumption, we can analysis that interest rate is more sensitive than sales growth. Though we understand the point of the manager in avoiding extra payment for overtime, we can be more sympathetic to employees who worked so hard to address the demand of the clients for the days that other employees are absent. Star River experienced a declining trend in total asset turnover from. What is the payback period of the project? It measures a firm's efficiency at generating profits from every unit of shareholders' equity also known as net assets or assets minus liabilities. Words: 1532 - Pages: 7.
There was also a giant jump in inventories from 1999 to 2000. Additionally, the sustainable growth rates are the most important figure for the company. What this will ultimately lead to is a cash inflow robber. Due to its production of high-quality discs, Star River gained fame in the industry. Words: 2789 - Pages: 12. The codes of ethics were maintained and that the company responded quickly to changing external forces and trends.
Also, Koh is not sure, whether they can repay the bank loan within the reasonable period. Case Overview: Star River Electronics Ltd. The machines also increased the cost of labor with overworking hours as well as maintenance cost forthe use of machine. The judge that decided the case was Judge Ferguson J and he made his judgment on 26th April 2012. The owners want to expand their business and are considering constructing a new twenty six bed convalescent unit in a new area where the demand and reimbursement returns are similar to their present business. At first glance she is not an attractive or pretty woman and she is hopeful and naive in the extreme. The point of this report is to analyze the legal ramifications and statistics based on the situation at hand and to deduce the appropriate course of action to take based off the analysis.
Acme Electronics Case Date: March 6, 2012 To: Jetson, on behalf of Acme Electronics From: Team 4 Consulting Firm Re: Legal and statistical evaluation of problems facing Acme Per your request, we have assembled a report with a legal and statistical evaluation of the problems facing Acme. Moreover, the current ratios were 0. Table: Ratio Analysis of Star River year199819992000200120022003 Profitability Operating Margin % 18. It has enjoyed a great deal of success in the past, due in large part to their excellent reputation for producing high-quality discs. The more cost we spend the more external financing we need. This can result in volatile earnings as a result of the additional interest expense. The initial purpose of this subsidiary is to market two products that were previously marketed in Europe successfully.
Estimate Return on Book Asset and Equity and identify key assumptions of those returns. Consolidation followed as less efficient producers went out of business. Other relevant facts and assumptions for preparing the financial forecast are stated below- Assume that sales will increase at 15% per year Operating expenses and operating profit will increase by the same percentage Assume that cash will increase at 15% per year Accounts receivable and inventories will also increase by the same percentage Assume accounts payable and other accrued liabilities will increase by 15% per year Interest expense is weighted for short-term debt and long-term debt: 6. Low values less than 1 , however, do not indicate a critical problem. RiverStar, Inc is a contract manufacturing company which specializes in , for its partners.
Because of its superior reputation, Star River was able to survive the shakeout. As Francine grew the company into new cities, she appointed Branch Managers to manage the teams there. Therefore, Star River has short- term liquidity problem to meet is current liabilities. What are the advantages and disadvantages. It shows that though sales are increasing at a substantial rate, increase in interest payment slows the growth of Net Earnings. In 1891 Philips was established by Gerard and his father Frederik Philips in Eindhoven, Netherlands. Problem Statement New Era looked at Star River as one of its promising venture-capital investments.