Re: ::: vuaskari.com ::: Fin622 gdb_idea solution Admin Binish Awais and Kamran haider

PLZ SEND ME THE SOLUTION OF ENG101 ASSIGNMENT.

From: Admin Binish <greyferry@gmail.com>
To: VU askari <vuaskari_com@googlegroups.com>
Sent: Sunday, October 30, 2011 7:14 PM
Subject: ::: vuaskari.com ::: Fin622 gdb_idea solution Admin Binish Awais and Kamran haider

Fin622 gdb_idea solution

Admin Binish Awais

Kamran haider

www.vuaskari.com

 

 

 

Q1.            Keeping other factors constant, you are required to highlight the reasons for the increase in current ratio.

As per my suggestions if all other factors are kept constant than the reasons for increase in currents ratios are as followings

 Solution:

1-Sweeping of  Bank Accounts by company

2-Improved  Current Asset by Rising Shareholder's Funds

3-Sell-off Unproductive Assets by company

4-Pay off Current Liabilities

5-Faster Conversion Cycle of Debtors or Accounts Receivables

6-Increase in  company cash balance with a long-term loan
7-Increase in  current assets with new equity investments

8-Convertion  fixed assets to cash by company

9-Pay off  of  some current liabilities

 Q2.            You are also required to suggest that, with company's point of view, would this increase be considered as positive or negative.  Give arguments in favor of your suggestion.

Solution :

The ideal current ration is supposed to be 2:1 means that current assests must be twice that that of current liabilities.  If this ratio is less than 2:1 the short term financial position is not supposed to be too favourable but if its is more than this limit than it is showing idleless no working capital.

Here in this scenario

current ratio in 2009 is 1.2:1 

current ratio in 2010 is 1.96:1

conclusion

Although increase in current ratio is positive sign but ratios in both years don't match the standard requirements

 

--

Admin Vuaskari 

    Binish Awais 

www.vuaskari.com

--
We say, "Be one as Pakistani Nation and grow up for Pakistan's Future". Wish you all the best. Join www.vuaskari.com,
To post to this group, send email to vuaskari_com@googlegroups.com
Visit these groups:
This (Main) Group:http://groups.google.com/group/vuaskari_com?hl=en?hl=en
MIT/MCS Group: http://groups.google.com/group/vu_askarimit?hl=en?hl=en
HRM Group: http://groups.google.com/group/askari_hrm?hl=en?hl=en
Banking Group: http://groups.google.com/group/askari_banking?hl=en?hl=en
Management: https://groups.google.com/group/vuaskari_mgt?hl=en
Marketing: https://groups.google.com/group/vuaskari_mkt?hl=en
MIS Group: http://groups.google.com/group/askari_mis?hl=en