Working capital management techniques for cash

Reference no: EM133196652

Assignment - Financial Analysis on Company Performance & Time Value of Money Concepts

Learning Outcome 1: Access a company's financial performance and position using the techniques of financial statement analysis.
Learning Outcome 2: Apply working capital management techniques for cash, receivables, and inventory management in business operations
Learning Outcome 3: Compute the future value, the present value of cash flows, and the yield rate for different investments.

TASK A

You are required to download from the websites the Income Statement and Balance Sheet of a real company. The financial statements for the TWO most recent years should be used. You will find the financial statements either on the websites of companies or you can search

Analyze the income statement and the Balance Sheet calculate the following ratios for the two years. Write the formulas clearly and show the amounts used in the calculations with complete steps. Compare the results of the two years and write your analysis and interpretations on the same. You may use ratios of competitors for a better comparison.

Required to use MsExcel to do the workings and insert the MsExcel table in the report and also use graphs and charts for an improved presentation of the results of the calculations.
a. any two profitability ratios
b. any two activity ratios
c. any one debt ratio

TASK B
Answer the following question

ABC LCC sells its products on a gross profit of 20% on sales. The following information

Is extracted from its annual accounts for the year ended 31st March 2020.

Amount $

Sales (3months credit)

Raw materials

Wages (15 days in arrears)

Manufacturing expenses (one month in arrears)

Administration expenses (one month in arrears)

Sales promotion expenses (Payable half yearly in advance)

40,00,000

12,00,000

9,60,000

12,00,000

4,80,000

200,000

The company enjoys one month's credit from suppliers of raw materials and maintains 2 months stock of raw materials and one and a half months finished goods. Cash balance is maintained at $100,000 as a precautionary balance. Assuming a 10%margin, find out the working capital requirements of ABC LCC.

TASK C

Answer the following question

Mr. Abdullah is planning to invest $ 100,000 and looking for a good investment opportunity. that will maximize the return with minimum time. Following options are available for him. Calculate and analysis the return from each investment option and advise him by considering the Rate of return and time value of money.

Option 1	Deposit $100,000 in an account earning 12% simple interest for 6 years
Option 2	Deposit $100,000 in an account earning 7% compound interest for 4 years
Option 3	Deposit $100,000 in an account earning 14% simple interest for 3 years
Option 4	Deposit $100,000 in an account earning 5% compound interest for 6 years

Attachment:- Financial Analysis.rar

Reference no: EM133196652

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