How to understand the calculations of cash flow and strategies to increase it.

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Business Finance

Description

Purpose of Assignment

The purpose of this assignment is to help students gain a better understanding of calculations of cash flow and strategies to increase it.

Assignment Steps

Select a multinational company from the following industries:

  • Automotive

Review the selected company's most recent financial statements.

Calculate the following cash conversion cycle ratios based on the financial statements using Microsoft® Excel®:

  • Average inventory
  • Inventory turnover rate
  • Average account receivable
  • Account receivable turnover
  • Average collection cycle

Explain in 700 words the importance of the cash conversion cycle, including:

  • Discuss the purpose of the cash conversion cycle and its components.
  • Analyze the results obtained in the cash conversion cycle equations.
  • Propose strategies to increase the cash flows of the company under study.

Format your paper consistent with APA guidelines.

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Explanation & Answer

Attached.

Samsung Electronics Co., Ltd. and its subsidiaries

INTERIM CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
(In millions of Korean won, in thousands of US dollars (Note 2.3))
For the three months ended March 31,
Notes

Revenue
Cost of sales
Gross profit
Selling and administrative expenses
Operating profit
Other non-operating income
Other non-operating expense
Share of profit of associates
and joint ventures
Financial income
Financial expense
Profit before income tax
Income tax expense
Profit for the period
Profit attributable to owners of the
parent
Profit attributable to non-controlling
interests
Earnings per share for profit
attributable to owners of the parent
(in Korean Won, in US dollars)
- Basic
- Diluted

2017
KRW

2016
KRW

2017
USD

2016
USD

19
19

50,547,526
28,155,597
22,391,929
12,493,568
9,898,361
316,423
277,234

49,782,252
30,373,858
19,408,394
12,732,582
6,675,812
702,593
338,636

43,777,400
24,384,553
19,392,847
10,820,231
8,572,616
274,042
240,102

43,114,624
26,305,710
16,808,914
11,027,233
5,781,681
608,491
293,280

6

19,338

9,147

16,748

7,922

20
20

2,097,152
1,889,464
10,164,576
2,480,222
7,684,354

3,079,929
3,006,360
7,122,485
1,869,682
5,252,803

1,816,268
1,636,397
8,803,175
2,148,031
6,655,144

2,667,416
2,603,701
6,168,529
1,619,265
4,549,264

7,488,532

5,263,506

6,485,549

4,558,534

195,822

(10,703)

169,595

(9,270)

53,656
53,656

36,356
36,356

46.47
46.47

31.49
31.49

17
17, 18

21

22

The above interim consolidated statement of profit or loss should be read in conjunction with the accompanying notes.

6

Samsung Electronics Co., Ltd. and its subsidiaries

INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In millions of Korean won, in thousands of US dollars (Note 2.3))

Notes

For the three months ended March 31,
2017
2016
2017
2016
KRW

Profit for the period
Other comprehensive income (loss)
Items not to be reclassified to profit or loss
subsequently:
Remeasurement of net defined benefit
liabilities (assets), net of tax
Share of other comprehensive income (loss)
of associates and joint ventures, net of tax
Items to be reclassified to profit or loss
subsequently:
Changes in value of available-for-sale
financial assets, net of tax
Share of other comprehensive income (loss)
of associates and joint ventures, net of tax
Fo...


Anonymous
I was having a hard time with this subject, and this was a great help.

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