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CCA Case Qs
CCA had clearly been pursuing a rather aggressive growth strategy, and its current and past performance suggest both the success and the risk factors of this strategy. Success can be obtained with a high-growth strategy as long as there is ample demand for the product or service being offered, and of the producer (CCA, in this case) can provide a differentiation or, as is the case here, a cost- and/or efficiency-savings when compared to other alternatives. CCA was successful in this regard to a large degree during much of its operation, but the risk factors of a high-growth strategy eventually caught up with the company. A slackened demand led to the company being overextended and unable to effectively meet its obligations, to the point that operations and the very existence of the company were threatened. Aggressive growth depends on ongoing...
Revenues have increased for the company, but expenses are also currently increasing, showing other risks of a growth strategy -- its growth has outpaced its capacity to truly function efficiently, or else managers have simply stopped worrying about costs as much.
2)
The balance sheet and income statement of the company clearly reflect the growth strategy and some of the hiccups it can cause. Net income is actually falling slightly despite the fact that assets and revenue are both rising, which shows that as the company continues to expand its operations the rate of growth in its costs is actually outpacing the growth in its revenue, and though this has created some savings in the form…
Balance Sheet Financial analysis is critical to determining the intrinsic value of a company. Analysts, hedge funds, institutional investors and retail investors alike all use various forms of information to determine a fair price to pay for a security. This information is generally acquired through the financial statements of the particular company being researched. In addition to the many forms of information gathering within the market, there are also many philosophies
Balance Sheet a) Using the 2012 Annual Report, which reflects the fiscal year ended December 31, 2012, Facebook lists short-term liabilities on its balance sheet of $1.052 billion, split between several categories. The largest of these is the accrued expenses, followed by the capital lease obligations. The long-term debt on the company's balance sheet is $1.50 billion with the total long-term liabilities being $2.296 billion. b) The market capitalization of Facebook is
Balance Sheet Question/Statement: Select either the balance sheet or income statement and explain how the use of it may be applied to your everyday life. The balance sheet may be applied to everyday life in that it can be used to assess past performance, as well as to plan for future undertakings. If, for example, an individual used one's birthday as the balance sheet statement date, then the balance sheet would show
Balance Sheet Adjustments The updated balance sheet for Module 2 is as follows: Balance Sheet Assets Current Assets Cash Accounts Receivable Inventory Property, Plant, and Equipment Equipment Total Assets Liabilities and Stockholder's Equity Current Liabilities Accounts Payable Long-Term Debt Long-Term Debt Total Liabilities Stockholder's Equity Common Stock Paid In Capital Retained Earnings Total Stockholder's Equity Total Liabilities & Stockholder's Equity Because the customer did not commit to the purchase, the Sales account would have been credited the 45,500 and the inventory account debited 45,500 to correct the original transaction. The computation of the
Capital structure decisions can be deliberate as well, yet an analyst without knowledge of the firm's intentions could make an entirely different determination about the validity of the firm's capital structure if based only on the balance sheet. At a minimum, the income statement is also required and in most cases much more information than that is needed to make an accurate assessment of the firm's financial condition (Kennon,
The attention on cases of impairment has generally been reduced, but this is expected to increase with the more emphasis placed on financial analysis and audits, a need generated by the contemporaneous economic crisis (Wayman, 2009). As an addition then, there have been developed complementary regulations. IFRS 3 for instance, states that while amortisation tests will not be conducted, impairments tests will still be performed. IAS 39 states that