9/27/2014 ROI = Net Income / Average total Assets = 39,510,000/ (231,839,000 + 207,000,000) /2 =18%
9/28/2013
ROI = Net Income / Average total Assets = 37,037,000/ (191,532,000) =19%
B.) In terms of Business or Organizational Structure, the main reason on why Apple Inc. is the largest technology in the world is because of being a Centralized company (UKessays.com, 2003). Kokemuller, (2015) stated that the leaders make the most critical decisions and handle responsibilities by his own. There are advantages using Centralized business structures such as being focused in one vision wherein the leader prevents potential inconsistency in vision which will help companies to communicate to consumers easily in one direct path. Also, the move is fast execution where the pros and cons of decisions in a small group are being decided with leaders. In addition, conflicts decreases due to the facts that only top managers take the risky, unfavorable and critical decision making. Lastly, Control and Accountability is where leaders control the company’s operation together with improvement with its culture. On the other hand, the financial structure it is said that the financial leverage is mainly coming from debt, it is not high in leverage which is being finance by the equity investment or operating income profit. In terms of solvency, it will take longer years before this company falls due to the fact that there are still payments which they allot for debts. C.) In terms of Current Ratio and Quick Ratio both results to a decrease which is considered an unfavorable type. D.) Based on the figure above, the current deposit rate in UK, London is 1.75 %, while the Return of Equity is 41 % as of August 2015 (Europedeposits.org, 2015). Since the ROE is higher than the CDR we must invest our money more into business than just putting it in the bank. E.) Actually, there are two options in this recommendation. …show more content…
First, the Issuance of Debt securities where there is tax deductible of interest such as Non Payable and Bonds payable. On the other hand, the Issuance of Equity securities where there is fixed interest payment such as common stocks and prepared stocks. In this case, I would recommend the Equity Security, due to its advantages applicable to Apple, Inc. As explained by Writer (2008), in Equity Security when you buy stock you also own part of the company where you have the right to vote in shareholder meetings personally or by representatives. Also, if the company gains income and assets then your share will also grow. In addition, there is much appreciation for your share either monthly or quarterly.
F.) I advise that the best working capital would be Optimal Level of working capital. As defined by Svtuition.org (2010), it is where the company can pay the daily expenses wherein they can afford to buy stocks if they are still not paid by the debtors. In this case, the Retained Earnings is high which means that Apple. Inc. has many stocks and is a strong company which can stand and operate with minimal debt. Task 2 A.) …show more content…
On the other hand, in December there is a lesser Accounts Receivable where we need to tighten it because the sales decrease.
Task 3
A.)
• Accounting rate of return Project 1 ARR = (58-2+4/ 3) /200 = 10 % Project 2 ARR= (36-4+8/3)/ 100 = 13. 33%
• Payback period Project 1 Project 2
Year 1 122.33 65.33
Year 2 62.33 25.33
Year 3 68.33 37.33
Payback Period 2.22 years 2.25
9/28/2013
ROI = Net Income / Average total Assets = 37,037,000/ (191,532,000) =19%
B.) In terms of Business or Organizational Structure, the main reason on why Apple Inc. is the largest technology in the world is because of being a Centralized company (UKessays.com, 2003). Kokemuller, (2015) stated that the leaders make the most critical decisions and handle responsibilities by his own. There are advantages using Centralized business structures such as being focused in one vision wherein the leader prevents potential inconsistency in vision which will help companies to communicate to consumers easily in one direct path. Also, the move is fast execution where the pros and cons of decisions in a small group are being decided with leaders. In addition, conflicts decreases due to the facts that only top managers take the risky, unfavorable and critical decision making. Lastly, Control and Accountability is where leaders control the company’s operation together with improvement with its culture. On the other hand, the financial structure it is said that the financial leverage is mainly coming from debt, it is not high in leverage which is being finance by the equity investment or operating income profit. In terms of solvency, it will take longer years before this company falls due to the fact that there are still payments which they allot for debts. C.) In terms of Current Ratio and Quick Ratio both results to a decrease which is considered an unfavorable type. D.) Based on the figure above, the current deposit rate in UK, London is 1.75 %, while the Return of Equity is 41 % as of August 2015 (Europedeposits.org, 2015). Since the ROE is higher than the CDR we must invest our money more into business than just putting it in the bank. E.) Actually, there are two options in this recommendation. …show more content…
First, the Issuance of Debt securities where there is tax deductible of interest such as Non Payable and Bonds payable. On the other hand, the Issuance of Equity securities where there is fixed interest payment such as common stocks and prepared stocks. In this case, I would recommend the Equity Security, due to its advantages applicable to Apple, Inc. As explained by Writer (2008), in Equity Security when you buy stock you also own part of the company where you have the right to vote in shareholder meetings personally or by representatives. Also, if the company gains income and assets then your share will also grow. In addition, there is much appreciation for your share either monthly or quarterly.
F.) I advise that the best working capital would be Optimal Level of working capital. As defined by Svtuition.org (2010), it is where the company can pay the daily expenses wherein they can afford to buy stocks if they are still not paid by the debtors. In this case, the Retained Earnings is high which means that Apple. Inc. has many stocks and is a strong company which can stand and operate with minimal debt. Task 2 A.) …show more content…
On the other hand, in December there is a lesser Accounts Receivable where we need to tighten it because the sales decrease.
Task 3
A.)
• Accounting rate of return Project 1 ARR = (58-2+4/ 3) /200 = 10 % Project 2 ARR= (36-4+8/3)/ 100 = 13. 33%
• Payback period Project 1 Project 2
Year 1 122.33 65.33
Year 2 62.33 25.33
Year 3 68.33 37.33
Payback Period 2.22 years 2.25