Net Profit Case Studies Samples For Students

Executive summary

There are several factors that are generally considered in the starting of a business. These factors include availability of capital, skills available, location of the business among others. In an advanced level, one should also consider the tax implications of starting each particular business.

There are several forms of business formations. Depending on the owner’s preference, one may decide to start a sole proprietors business, a partnership or incorporate a company. This study will majorly discuss the modes of formation of a sole proprietorship and a company, the advantages of running these types of business and the suitability of such businesses at different levels ...

Question one: Strategic profit model for Wal-Mart and Tiffany

Figure 1: Strategic Profit Model for Wal-Mart
Figure 2: Strategic Profit model for Tiffany in 2009

Comparison between strategic profit models for the two organizations

Question two:
Gross margin percentage = Gross marginNet sales
Wal-Mart: $95,086$401,200 = 23.7%
Tiffany: $1,530$2,709 = 56.5%
Expenses-to-sales ratio = Total ExpensesNet sales
Wal-Mart: 78461401244 = 0.1955
Tiffany: 11442709 = 0.422
Net profit margin after taxes = Net Profit (After taxes)Net Sales
Wal-Mart: 10939401244 = 2.72%
Tiffany: 2622709 = 9.6%
Inventory turnover = Cost of goods soldAverage inventory
Wal-Mart: 30615834511 = 8.871
Tiffany: 11791427 = 0.8262
Asset turnover = Net Sales Total Assets
Wal-Mart: ...

Introduction

United Bank for Africa is one of the fastest growing banks in the African continent. It was formed in 1961 in Nigeria and has its headquarters in Lagos. Universally, it has more than 6 million customers, and has 750 operational branches distributed in almost 20 countries in Africa. It prides of its existence in USA, France and UK. The bank was formed through a merger agreement with Standard Trust Bank in 2005. The bank is listed in Nigerian Stock Exchange. It became the holding company in 2011.
UBA uses the International Financial Accounting Standards (IFRS) as its major accounting ...

13th, November, 2013

Analysis of Electronic Arts: Ratio Analyis and Effect of Alternative Accounting Methods on Ratios
Profitability Analysis:
The ratio analysis reveals that over the years, the profitability of the company is improving. In terms of net profit margins, the company has made an applausable leap from -25.8% to 2.6% over the years.(2009-2013 ) This year the net profit margin of the company has surpassed industry benchmark of 2%.
Analyzing the ratios relating to decomposition of profit figures provides us with a better picture relating to working of the company over the years. Both Gross Profit Margins and Operating ...

Company’s financial statements provide crucial details on different aspects on its operations. That includes information about its performance in terms of profitability, assets utilization and management efficiency, business liquidity as well ability to provide a suitable return for its stockholders. Thus, understanding the statements is crucial in all planning including operations, financial and marketing. In that respect, this analysis seeks to demonstrate how the statements can be used as a guide on marketing planning and general business management. To achieve that objective, the analysis uses the case of Abercrombie & Fitch and analyzes its financial statements for the year 2012 and ...

Foing-nova is an IT company located in Varaždin, Croatia, which provides software for users of the state budget. However, Foing-nova remains a small business despite recently changing its location and expanding its headquarters. After consulting RajkoTomiek, who is the CEO of Foing-nova, it was clearly understood that the most suitable method of company’s expansion would be to increase their market share. Although, Foing-nova is expected to gain new customers by entering a new market and thus become more profitable. However, a strategy must be put in place to ease the diversification of the company and to ensure ...

Profitability ratios carry great significance as it indicates the level of profit margins being earned from its business. These ratios have the capacity to influence the investment decisions of the shareholders. The paper describes the profitability ratios of Starbucks Inc and Jamba Juice over the period of two years, i.e. 2012 and 2013:
i) Gross Profit Margins:

Analysis:

The above data indicates that Gross Profit Margins of Jumba Juice was significantly higher than that of Starbucks Inc, however during 2013, the gross margins of Starbucks Inc increased from 56.29% to 57.14% courtesy decline in percentage of cost of sales to ...

Enterprise Resource Planning

Introduction
Two teenagers with only a hundred dollars launched United Parcel Service. It is the perfect example of ingenuity, hard work, and dedication to fulfill the American dream. Jim Casey 19, and Cloude Ryan 18, had one bike for the operation. Since there were no phones in the early 1900’s, telegraphs had to be delivered by hand (Hiskey 2010). The two saw the opportunity and focused on this to be their area of expertise. They also delivered lunch for office workers. After a few years, the two merged with a rival company known as the Merchants Parcel Delivery and in ...

Five Below, Inc. is a retail chain belonging to the specialty retail industry which was incorporated in Pennsylvania, USA in 2002. It offers “dynamic, edited assortment of exciting products, all priced at $5 and below, including select brands and licensed merchandise” ("Overview | Fivebelow"). Five Below’s products range from sports equipments, styling merchandise, small décor items, craft works to candies and party items. It largely targets customers who are teenagers or pre-teens.
Since the company’s inception, it has expanded its business to almost all regions of the United States and has been successful in opening more than ...

Introduction

The analysis of a company can be initiated and done from two different angles known as financial analysis and nonfinancial analysis. However, both of the types of analysis are essential for the investors as well as internal stakeholders of the company (Kamauff, 2010). Most of the times, the analysis would have been performed specifically by the investors to analyze the effectiveness of the financial markets and financial statements, and they are continuously delivering their best to maximize their earnings. Maximization in the earnings is not the attractive behavior and effective sign for an investor, as there are some other dominating ...

Introduction

Carbonated Soft Drinks (CSD) have a long history. Carbonated soft drinks have dominated the non-alcoholic beverage market for more than half a century. Coca Cola and PepsiCo are the two main competitors in this industry. Over the period of last 50 years Pepsi and Coke have enjoyed duopoly in the CSD market. Apart from the exception of one Dr. Pepper product, Pepsi or Coke always filled up the top ten selling brands in the CSD business. Coke and Pepsi have battled against each other fiercely to gain market share and brand loyalty. If in some decades Pepsi succeeded, Coke succeeded in ...

This paper is a financial report that gives an evaluation of AMD financial performance for 2008, 2009 and 2010. In the report are the analyses of the company’s financial performance using conventional financial indicators and financial ratio trends. The report also gives an evaluation of the stock performance of the company for the same period. Finally, there are recommendations of the possibility of High Technology Company entering into a long term contract with AMD.

AMD

AMD stands for Advanced Micro Devices. It is a company that sells and designs digital integrated circuits, abbreviated as ICs. The company’s products also include embedded ...

Introduction

United Bank for Africa Plc (UBA) is one of the leading financial service institutions in Nigeria and West Africa, listed on the Nigerian Stock exchange, UBA is rapidly evolving into Pan African Service institution. Several ratios were applied on the financial data of the company and there were areas where the company performed well while in other areas there are valid concerns.

Financial Analysis

There are various ratios that showed that the company had improved in terms of profit in the period 2007 to 2008. The following ratios showed positive growth.
Net Profit Ratio: Net profit ratio increased from a figure ...

Internal analysis of Hudson’s Bay Company

Introduction
The internal analysis of a firm enables the understanding of the internal factors that has contributed to the position that the firm is currently in. It involves the analysis of the resources of the firm and the attributes such as inbound logistics, operations, marketing, human resources management, development of technology that adds value to the organisation. The core competency analysis enables the understanding of the expertise, skills and abilities it has to maintain a competitive position in the industry. Internal analysis also enables the finding of the key success factors that are contributing to the competitive advantage of ...

Profit Wheel Analysis

Cash Wheel
This part of the profit wheel is composed of the operating cash, inventory, accounts receivable, and sales. The main question therefore is whether the company has enough inventories, accounts receivable, operating cash, and sales to switch to a private brand of coffee. The answer to which would be a yes. In terms of cash, the company posted an initial cash of 1.121 Billion ITL at the start of the year; the composition of private coffee sales on total sales is continuously increasing month on month and the same goes for the account receivables as well.

Profit Wheel

Sales, investments ...

Corporate Finance

Answer 1)
Compound Annual Growth refers to growth over the years and is calculated by adding each year growth to the original amount. As for the sales of the company, the compounded growth rate for sales over 5 years time horizon is 11.05%. In other words, starting with the year 2000, when the sales of the company were $600000, by the end of 5 years, the sales of the company following 11.05% growth rate had increased to $1013376.
However, the net income of the company grew with annual compound rate of -136.10%. In other words, there was ...

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Ans-A)
Page-579
Economics is a field which has its recognition in almost every walk of life. Different authors have different views about the concepts of economics and among them; the name of “Adam Smith” is one of them. According to the Concept of Adam Smith, Economics is the name of earning and consuming the money (Martin Cardel Gertsen, p.12). The main concept of economics strides that, how to earn the money and how to consumer it?
Eco Products are the products that meet with eight assessment based criteria which includes ...

Introduction

In Finance, Capital Structure means the way a company finances its assets through debt and equity. For example, if a firm is known to have financed 70% of its assets using debt and 30% using equity then the company is said to have a leverage of 70%. The higher the leverage, the more risky is the company from financial and investment perspective. There are different theories on the capital structure. Modigliani and Miller are known to be the founding fathers of the capital structure modeling in a perfect market. In a perfect market as per Modigliani and Miller it does not matter how a company ...

Introduction

Pehr Weisengraf could not interpret the financial ratios of his business after he was presented with a document of the calculated ratios by the banker following a failure to secure a loan for his business from the bank. The ratios are calculated to predict and ascertain the performance of the business by credit issuing institutions. The comparison of the ratios from the previous and current year did not match the required industry average that could have consequently determined what amount of loan could be awarded to his business. In this regard, it is essential that Weisengraf learns what the ratios mean and ...

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a)
i) SCON 6 defines ‘assets’ as those economic resources which are acquired by an entity through events or transactions done in the past. These resources certainly have future economic benefits and are under the control of the entity which uses them.
SCON 6 defines ‘expenses’ as cash outflows which are incurred due to the operating activities of an entity. These activities are the day-to- day operations which run an enterprise. Expenses are incurred when assets are used up or when liabilities are generated.
ii) Costs should be ...

Processor

Part 1.
A company’s strategy is normally examined by the financial perspective, which helps in determining whether a company will be able to contribute to its bottom line improvement. A financial perspective acts as an indication of a company’s strategic objective in a long term period, hence making the company to incorporate the outcomes that are tangible in terms of the traditional financial positions.
The financial position of a company is a key element used in defining an organization or a company’s success. This also explains how the company can generate the growth of the value of its shareholders. The ...

(Financial) Management Accounting Case Study
Every single organization of the world is now trying to flourish their growth comparatively better than that of their competitors (Bradtke, p.45). The thing that really matters for them to have the same comparative growth potential is the management of operational cost. Operational Cost, though a common thing for an organization, but emerged as a real gangrene if the proportion of the same would be on a higher node (Cokins, p.34).
Cost-Volume Benefits always bring positivity in the functions of the company, as it has the ability to manage the operational cost in such a manner ...

Industry factors

The company enjoyed prosperity in 2001 and 2003. In fact, it took advantage of the situations of other Airlines in U.S due to September 11 attack. The competitors began to recapture the market by lowering prices. Due to the changes, JetBlue was affected by low fares implemented by Delta and United Airlines. In 2003, JetBlue focused on busiest routes by launching new flight routes. The competitors entered the market and lowered its prices and at the same time increasing capacity. Delta and AirTran responded JetBlue flights from Atlanta to Los Angeles aggressively. This move forced JetBlue to withdraw its ...

Part A: Classification of items as assets or liabilities

Under this section, we will classify each of the given accounting transactions under appropriate category. Below presented is the snapshot of the excel sheet indicating the correct answers followed by the reasons for their classification under the relevant category:

Reasons for classification of each item:

a) An amount of £40K owed in incorporation tax: Since the company owes an amount, it will be classified under the liabilities section.
b) Stock worth £15K in the stock room: Stock/ Inventories are the current assets of the company and hence will be classified under current assets only.
c) An amount of £20K paid to a supplier for a product yet ...

Introduction

Dunkin' Brand Group is among the largest fast food companies. It is comprised of over 17000 points of distribution and operates in more than 57 countries. The headquarters of the company is in Canton, Massachusetts, in United States. In the fast food industry, it entails of two brands, Dunkin' Donuts and Baskin Robbins. Dunkin' Donuts is known for its swift customer service and high-quality coffee. Alternatively, the Baskin Robbins brand is known for its "31 flavors" slogan that represents 31 new flavors. Dunkin’ Donuts products include bagels, donuts, muffins, and hot and iced coffee. Baskin Robbins brand deals with ...

Part 1:

Ratio Analysis:
i)Current Ratio: Current Assets/ Current Liabilities
2009: 147000/ 42000= 3.5
2010: 153000/ 45000= 3.40
ii) Gross Profit Margin= Gross Profit/ Revenue*100
2009: 240000/620000*100= 38.70%
2010: 275000/682000*100= 40.32%
iii) Inventory Turnover Ratio: COGS/ Inventory
2009: 380000/120000= 3.16
2010: 407000/120000= 3.39
iv) Return on Investment = Net profit after interest and tax / Total Assets
2009: (7800/277000)*100= 2.81%
2010: (16580/265000)*100= 6.25%
b)

Summary:

Referring to the above calculated ratios of the company for the year 2009 and 2010, we could infer that overall the ...

The Company

Overview
The Body Shop is a successful chain of cosmetics shops, based in the United Kingdom, and founded in 1976. The company has shown remarkable growth, with revenues increasing from £2 million to £28 million in just 4 years from 1983 to 1987. The rapid growth was accomplished largely by franchising. By almost any measure, the first 15 years of the company’s existence must be considered one of the most successful in business history.

Key economic and technical background

The company was founded on a mixture of ethical principles and savvy business insight. The founder realized 2 important facts:
- First, traditional cosmetics ...

Organizations are made to earn economic profit with the help of new strategies and taking initiatives. A company has to undertake extensive and effective analysis in order to become economically and strategically active. There are certain models and theories that specifically used for the same purpose and every big company used the same in order to become economically and strategically prosper and active. The main perspective of this assignment is to make a profit plan of the company. The company name is Cafes Monte Bianco, that is a case study of the Harvard Business School. There are a number of questions that ...

1. Introduction
Strong Tie Ltd. is a Canadian family-owned company that specializes in manufacturing of standardized and customized structural connectors located in Winnipeg, Manitoba. It is run by the son of the founder together with his three daughters. Unlike its competitors, the company keeps its production in China, which is possible partly due to high level of automation of the production of standardized details. The production of customized details is labour-intensive, but high costs are supposedly being offset by high premium the customers are ready to pay.
Or are they? While Universal Connector – the main competitor who currently ...

Question 1: Examine the following ratios below, and conduct a three-year ratio analysis. Start think about the general trend of the ratios in each category for the 3-year period.Profitability Ratios

Liquidity and Solvency Ratios

Question 2: Interpret the ratios in each category and try to link them together to provide a coherent summarized viewpoint of the company financial situation. Be creative and analytical.
Let’s first look at the profitability ratios of the company. The company always has a very healthy Gross profit margin so the manufacturing/outsourcing capability of the company was always its stronghold. However the massive drop of margin from Gross Margin to ...

1.0. Background of London woods Limited
This is a private limited liability company that specializes in the production of furniture for sale to wholesale, retail and private use. It has been in business for the past five years and currently it employs 50 personnel that work within the company. It operates in the domestic market. The company was founded by three young men that were carpenters, Billi Kid, Bengazy and Lee Jones. These young men were energetic and they had appointed Operations Director aged 25 years. The operation's director's name was Mathew Do It. He is an innovator who ...

Question 1

Price is the amount that a producer charges his or her consumers for a product or a service. There are various ways of determining price which may result in different prices for the same product. The pricing suggestion of the sales officer, the finance officer and the marketing officer will result in the following prices;

Pricing suggestion of the sales officer

According to the sales officer, the selling price of Amaizer should be 2,900 per tonne to make it make competitive as shown by the calculations below.

The sales officer recommended that the snack, Amaizer, should be sold at 100 below the price of potato crisps.

Price of potato crisps per tonne is 3,000
Therefore, the price of Amaizer will be; 3,000- 100 = ...