0
What else can I help you with?
Why do firms carry inventory?
Firms carry inventory to ensure they can meet customer demand without delays, which helps maintain customer satisfaction and loyalty. Additionally, inventory acts as a buffer against supply chain disruptions and fluctuations in demand, allowing for smoother operations. It can also help take advantage of bulk purchasing discounts and manage production schedules more effectively. Overall, carrying inventory is a strategic decision that balances costs with the need for responsiveness in the market.
What are some of the characteristics of a firm with a long cash cycle?
A firm with a long cash cycle typically experiences extended periods between cash outflows for inventory purchases and cash inflows from sales. This can result from high inventory levels, slow turnover rates, or extended credit terms offered to customers. Such firms may face liquidity challenges, as they need to manage operating expenses while waiting for cash to come in. Additionally, they might need to secure financing to bridge the gap between outflows and inflows.
Is quick ratio a better measure of the firms liquidity than current ratio?
Yes because a quick ratio doesn't include inventory which must be sold before it can be used to pay for the companies current obligations. Of course you have to collect the cash in A/R before it can be used to pay for current obligations too but AR should be able to be converted to Cash much quicker than Inventory. A Cash Ratios, which doesn't include AR or Inventory is an even better measure of a firms liquidity than both the quick and current ratio.
What is the turnover limit for statutory audit?
In India, the turnover limit for statutory audit depends on the type of business. For companies, a statutory audit is mandatory every year, no matter how small or big the turnover is. For partnership firms or proprietorships, a statutory audit is required if turnover exceeds ₹1 crore in a financial year (₹10 crore if cash transactions are very low, as per Income Tax rules). For example, if a partnership firm has sales of ₹1.2 crore in a year, it must get a statutory audit done by a Chartered Accountant. If you want to understand statutory audit rules and procedures in a very simple, practical way, many students find Master Blaster of Statutory Audit by CA Tushar Makkar quite helpful.
What companies are most likely to suffer cash shortages?
Companies most likely to suffer cash shortages typically include startups with limited revenue streams, businesses in cyclical industries that are sensitive to economic downturns, and those heavily reliant on external financing. Additionally, firms with high overhead costs and slow inventory turnover may face cash flow challenges. Industries like retail and hospitality can also be vulnerable during economic downturns or pandemics, as consumer spending declines.
Firms that successfully increase their rates of inventory turnover will among other things?
all of the above
Which firms offer warehouse inventory control software?
Some warehouse inventory control software firms include Fishbowl Inventory, Net Suite, SphereWMS, Giga Trak, Barcoding, Tracker Systems, and Warehousing Activate.
What is reasonable accounts receivable turnover ratio?
Answer:It depends on the industry. For grocery stores, it can be as high as 80. For firms in the manufacturing a number around 5-7 is more common. Accounts receivable turnover for firms in the service industry would be somewhat higher, 7-10.
Do activity ratios measure the effectiveness of the firms management in using its various resources to achieve profits?
Yes, activity ratios assess how effectively a firm utilizes its resources to generate revenue and profits. These ratios, such as inventory turnover and accounts receivable turnover, indicate how efficiently management is managing assets and liabilities. By evaluating these ratios, stakeholders can gauge the firm's operational efficiency and overall performance in converting resources into profits.
Advantages of labor turnover?
the firms can dismiss the unwanted employees that are not performing well or fit for their job so as to reduce inefficiency. after this labour turnover the company will be able to start again with new enthusiastic workers who will work hard and willing to increase production. also the managenmt will be able to learn from past experiences and can take necessary actions to improve the firm's standards
Is accumulation of inventories by firms is included in measuring GDP?
no....i think the change in inventory is included but not accumulation..
According to aggregate supply curve what happens as the price level increases?
firms have more of an incentive to increase output
Why and How Firms Internationalize?
expand sales and increase profit
What would happen if there was an increase in the number of firms?
Pushes it out
Which features is significant for market structure?
Significant features for a market structure include the number of firms and their scale, market share of the bigger firms, the nature of costs, extent of product differentiation, turnover of customers, and vertical integration.
What the are seven strategies employed by firms to reduce inventory in the supply chain?
Firms use several strategies to reduce inventory in the supply chain, including just-in-time (JIT) inventory management, which minimizes stock on hand by synchronizing production with demand. They may also implement demand forecasting to align inventory levels with anticipated sales. Another strategy is to enhance supplier relationships to ensure quicker replenishment times, while adopting lean manufacturing principles can streamline processes and reduce waste. Additionally, firms might utilize inventory optimization software to analyze and manage stock levels more effectively.
What has the author William Korbel written?
William Korbel has written: 'Turnover of retail firms in Kansas' -- subject(s): Business failures, Retail trade
