Other moves to reduce working capital, such as tightening the receivables turn, would not affect sales at all.
4.
1995 Pro-Forma
Net Sales
1938
COGS
Gross Profit
SGA Exp
Dep
32
Interest
63
EBIT
Tax
65.376
Net Income
5. I would suggest that Reed control his inventory with computerized tracking using SKUs. He should know exactly what is inventory level is at all times. This would allow him to have sales when levels are too high, improving his inventory turnover.
6. Accounts receivable should be controlled with incentives. Jim can provide discounts for early payment that encourage customers to pay more quickly. Currently, payment should...
A high rate of turnover may indicate too strict credit policies or an inability to extend credit. It is the tradeoff between sales and tying up funds in receivables. Sales to Working Capital - measures the relationship between sales and the working capital of a business. Too high a ratio may indicate an insufficient amount of working capital. Too low a ratio may indicate unproductive assets. Sales to Total Assets -
Pharmaceutical industries have to operate in an environment that is highly competitive and subject to a wide variety of internal and external constraints. In recent times, there has been an increasing trend to reduce the cost of operation while competing with other companies that manufacture products that treat similar afflictions and ailments. The complexities in drug research and development and regulations have created an industry that is subject to intense
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