Description
Part 1- 2 paragraphs roughly 200 words total in this part cite references in APA format
Based on your professional or academic experience with corporate finance, discuss what shareholder maximization means to you. What are the advantages and disadvantages of shareholder maximization from the perspective of the CFO of an organization?
Explanation & Answer
Attached.
Running Head: Financial Analysis
Financial Analysis
Name
Institutional Affiliation
Running Head: Financial Analysis
Inventory turnover is the ratio that shows how many times in a year in which a business converts
its inventory into sales. It ensures that a business has enough inventories as compared to its sales
level. A high ratio shows that the firm’s performance is considerably better due to the fact that it
attracts many customers as exemplified by larger sales. On the contrary, low ratio implies that
few customers are involved and therefore low sales but the inventory levels remains high.
The receivables turnover of Wal-Mart Corporation is relatively the same as that Amazon, but it is
slightly higher. It therefore implies that Wal-Mart firm sales are higher as it sells most of its
stock on cash basis. This makes it easier for the firm to offer credit to clients more comfortably.
Amazon on the other hand majorly operates on credit basis and most of its debtors have not
cleared payment. It becomes difficult to offer credit services to customers and consequently
result in low. The inventory turnovers for the two firms are illustrated below;
Inventory turnover =
The cost of Sales
(Beginning Inventory + Ending inventory) / 2
Wal-Mart
=3558069
(43803 + 44858) / 2
= 8.08 Inventory turnover
Running Head: Financial Analysis
Amazon Inc.
62752
(7411+8299) /2
= 7.99 In...