Health Care > ESSAY > C251 Accounting CAptsone WOT1 Task1 Part2. (All)
Financial Resource Activity Examination of Yellow Leaf, Inc 1 Financial Resource Activity Examination of Yellow Leaf, Inc. Western Governors University Mark Brann – Student # 000363150 FINANCIAL... RESOURCE ACTIVITY EXAMINATION OF YELLOW LEAF, INC 2 The following treatise covers key financial issues relating to the popular women's retail outlet, Yellow Leaf, Inc. Yellow Leaf was duly incorporated on December 31, 2011, domiciled in St. Louis, Missouri, with four stores located near it's Missouri headquarters. This report intends to illustrate management's efforts to reach it's integrated objectives for the fiscal year, 2014, and the resultant systemized and realized monetary outcome. Key components of the financial year shall be examined, specifically with an eye toward liquidity, activity, profitability, and coverage ratios in pragmatic effort to illustrate the company's quality effectiveness utilization strategies thus employed. As C.E.O. Gordon Lindenwood is fond of saying, "Turn a leaf and watch us grow." FINANCIAL RESOURCE ACTIVITY EXAMINATION OF YELLOW LEAF, INC 3 Capacity, Usage, and a Quest for Results Yellow Leaf, Inc. finished fiscal year 2014 with total sales revenue of $2,919,800, gross profits reigning in $2,163,800, and a bottom line net income of $819,218. Not bad for a store with only minimal funding half a decade earlier. Key ratios play an important part in looking back as well forward in relation to this bright, flashy upstart company. We shall examine four primary ratio laden areas of importance and relate an independent articulation of the results, as well as an even-handed summary of our thoughts and recommendations for this threadbare Mainstreet mini-giant. Liquidity Examined – Current Ratio Current ratios are utilized to assist both management and outside stakeholders to form a realized measure of how able-bodied a company is in regard to countering short-term debt. It poses as a snapshot of current assets held on the balance sheet and how assets may (or may not) be employed to satisfy current debt and/or payables. A current ratio that greatly exceeds its industry average is oftentimes considered a detriment as management may not be utilizing assets to their fullest capacity. Also worth noting is that even if a company holds a high current ratio, other factors are needed to form a coherent picture of liquidity. For example, a company with a high working capital ratio may also hold elevated accounts receivable, a dilemma where slow or low paying customer remuneration may hinder repayment of current liabilities owed. For the year ending December, 2014, Yellow Leaf's current ratio stands at 4.8308. A ratio less than 1.0 indicates a company's short term debts are greater than its current assets. On the surface Yellow Leaf's current ratio appears positive, however accounts receivable for 2014 stands at $1,268,800 while year end cash totals $1,162,333. Accounts receivable since 2012 have nearly doubled each year indicating the company relies heavily upon financed customer accounts. Cash inflow was FINANCIAL RESOURCE ACTIVITY EXAMINATION OF YELLOW LEAF [Show More]
Last updated: 1 year ago
Preview 1 out of 16 pages
Connected school, study & course
About the document
Uploaded On
Aug 01, 2022
Number of pages
16
Written in
This document has been written for:
Uploaded
Aug 01, 2022
Downloads
0
Views
39
In Browsegrades, a student can earn by offering help to other student. Students can help other students with materials by upploading their notes and earn money.
We're available through e-mail, Twitter, Facebook, and live chat.
FAQ
Questions? Leave a message!
Copyright © Browsegrades · High quality services·