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Activity Based Management At Ws Industries B Financial Analysis Case Study Help


Activity Based Management At Ws Industries B Financial Analysis Financial Analysis Case Study HelpThe financial position of Activity Based Management At Ws Industries B Financial Analysis can be examined by having a look at its ratio analysis.

Declining Profitability:

We can see in appendix 1 how the profits has actually been decreasing throughout the years after 2005. The fact that the gross earnings margin has actually reduced as well suggests that the expense of sales have not gone down at the same pace. The decreasing net profitability, revealing a negative trend from 2006 to 2007 recommends that expenditures have increased much more than the company has the ability to manage given its existing resources. With a long term debt adding to the interest expenditure, Activity Based Management At Ws Industries B Financial Analysis remains in dire requirement of an alternative earnings stream.

Declining Liquidity:

Decreasing Liquidity: We can see a major decreasing pattern in the current ratio too revealing a fall in liquidity which is another point of concern for Activity Based Management At Ws Industries B Financial Analysis specifically as it has a long term financial obligation to pay off. With the present possessions not in a position to settle the existing liabilities, we can see how the company would remain in a significant financial difficulty unless the cash flow enhances with extra sources of finance.

Rising Debt to Assets Ratio:

Rising Financial Obligation to Possessions Ratio: We might check out the monetary condition of Activity Based Management At Ws Industries B Financial Analysis further by looking at the business's overall financial obligation to overall possessions ratio in appendix 2. Such a circumstance has brought Activity Based Management At Ws Industries B Financial Analysis to a point where its overall debt to total assets ratio has increased. A rising total debt to total assets ratio recommends that the risk has actually increased in terms of the business's possessions not being enough to cover its total liabilities.

/Financial Feasibility