IcE CoOL CLaSS..Ta02..

2008-02-25T23:55:00.007+08:00

Hey guys! A lot of us discussed and we decided to have a BBQ cum picnic outing at East Coast Park next Saturday. Here are the details:

BBQ cum Picnic Outing

Day: Saturday

Date: 15 March 2008 (postponed to this date)

Venue: East Coast Park

Any information on the food etc juz chat with any of our classmates through MSN. It would be best if the whole class could go but those who can't go, please inform any of our classmates so we can accomodate the food accordingly. Tanx!

Nash :D

2008-01-25T11:07:00.000+08:00

Hey Guys! Itz been a long time since someone blogged in this class blog. Anyway, one of our classmates, Ling Hui has suggested a class outing after the examz as the whole class would be separated next year due to attachment. Thus, here are the options u guys can choose for the outing.

Ice Skating (suggested by Ling Hui)
Movie Outing
Class Picnic (probably at East Coast Park where we can cycle etc)
Barbeque

Think about them and if u guys have any other ideas, feel free to voice them out! The poll is set up at the left side of the blog. Pls vote! Tanx! :D

Nash

2007-11-18T22:02:00.000+08:00

1. Review Questions

14-11) What is the role of the five Cs of credit in the credit selection activity?

14-13) What are the basic tradeoffs in a tightening of standards?

14-16) Why should a firm actively monitor the accounts receivable of its credit customers? How are the average collection period and an aging schedule used for credit monitoring?

2. Problems

14-9) Relaxation of credit standards
Lewis Enterprises is considering relaxing its credit standards to increase its currently sagging sales. As a result of the proposed relaxation, sales are expected to increase by 10% from 10,000 to 11,000 units during the coming year; the average collection period is expected to increase from 45 to 60 days; and bad debts are expected to increase from 1% to 3% of sales. The sale price per unit is $40, and the variable cost per unit is $31. The firm’s required return on equal-risk investments is 25%. Evaluate the proposed relaxation, and make a recommendation to the firm. (Note: Assume a 365-day year.)

14-11) Shortening the credit period
A firm is contemplating shortening its credit period from 40 to 30 days and believes that as a result of this change, its average collection period will decline from 45 to 36 days. Bad-debt expenses are expected to decrease from 1.5% to 1% of sales. The firm is currently selling 12,000 units but believes that as a result of the proposed change, sales will decline to 10,000 units. The sale price per unit is $56, and the variable cost per unit is $45. The firm has a required return on equal-risk investments of 25%. Evaluate this decision, and make a recommendation to the firm. (Note: Assume a 365-day year.)

2007-11-10T22:22:00.001+08:00

FMGT TUTORIAL
Review Questions

1. 14-4) What is the difference between the firm’s operating cycle and its cash conversion cycle?

14-17) What is float and what are its three components?

14-18) What are the firm’s objectives with regard to collection float and to payment float?

14-21) What two characteristics make a security marketable? Why are the yields on nongovernment marketable securities generally higher than the yields on government issues with similar securities?

Problems

14-1) Cash conversion cycle
American Products is concerned about managing cash efficiently. On the average, inventories have an age of 90 days, and accounts receivable are collected in 60 days. Accounts payable are paid approximately 30 days after they arise. The firm has annual sales of about $30 million. Assume there is no difference in the investment per dollar of sales in inventory, receivables, and payables; and a 365-day year.
a. Calculate the firm’s operating cycle.
b. Calculate the firm’s cash conversion cycle.
c. Calculate the amount of resources needed to support the firm’s cash conversion cycle.
d. Discuss how management might be able to reduce the cash conversion cycle.

14-3) Multiple changes in cash conversion cycle
Garrett Industries turns over its inventory 6 times a year; it has an average collection period of 45 days and an average payment period of 30 days. The firm’s annual sales are $3 million. Assume there is no difference in the investment per dollar of sales in inventory, receivables, and payables; and a 365-day year.
a. Calculate the firm’s cash conversion cycle, its daily cash operating expenditure, and the amount of resources needed to support its cash conversion cycle.
b. Find the firm’s cash conversion cycle and resource investment requirement if it makes the following changes simultaneously.
(1) Shortens the average age of inventory by 5 days.
(2) Speeds the collection of accounts receivable by an average of 10 days.
(3) Extends the average payment period by 10 days.
c. If the firm pays 13% for its resource investment, by how much, if anything, could it increase its annual profits as a result of the changes in part b?
d. If the annual cost of achieving the profit in part c is $35,000, what action would you recommend to the firm? Why?

14-13) Float
Simon Corporation has daily cash receipts of $65,000. A recent analysis of its collections indicated that customers’ payments were in the mail an average of 2.5 days. Once received, the payments are processed in 1.5 days. After payments are deposited, it takes an average of 3 days for these receipts to clear the banking system.
a. How much collection float (in days) does the firm currently have?
b. If the firm’s opportunity cost is 11%, would it be economically advisable for the firm to pay an annual fee of $16,500 to reduce collection float by 3 days? Explain why or why not.

Thanks to Yeling again! Hahah. J

2007-11-04T14:01:00.000+08:00

FMGT TUTORIAL QNS
Review Questions
14-1) Why is short-term financial management one of the most important and time-consuming activities of the financial manager? What is net working capital?

14-3) Why does an increase in the ratio of current to total assets decrease both profits and risk as measured by net working capital? How do changes in the ratio of the current liabilities to total assets affect profitability and risk?

14-5) Why is it helpful to divide the funding needs of a seasonal business into its permanent and seasonal funding requirements when developing a funding strategy.

14-6) What are the benefits, costs and risks of an aggressive funding strategy and of a conservative funding strategy? Under which strategy is the borrowing often in excess of the actual need?

Problems
14-4) Aggressive versus conservative seasonal funding strategy
Dynabase Tool has forecast its total finds requirements for the coming year as shown in the following table.

Month
Amount

Month Amount
January $ 2,000,000
February $ 2,000,000
March $ 2,000,000
April $ 4,000,000
May $ 6,000,000
June $ 9,000,000
July $ 12,000,000
August $ 14,000,000
September $ 9,000,000
October $ 5,000,000
November $ 4,000,000
December $ 3,000,000

A. Divide the firm’s monthly funds requirements into (1) a permanent component and (2) a seasonal component, and find the monthly average for each of these components.

B. Describe the amount of long-term and short-term financing used to meet the total funds requirement under (1) an aggressive funding strategy and (2) a conservative funding strategy. Assume that under the aggressive strategy, long-term funds finance permanent needs and short-term funds are used to finance seasonal needs.

C. Assuming that short-term funds cost 12% annually and that the cost of long-term funds is 17% annually, use the averages found in part a to calculate the total cost for each of the strategies described in part b.

D. Discuss the profitability-risk tradeoffs associated with the aggressive strategy and those associated with the conservative strategy.

also. thank you yeling! for helping to type out these. :)

2007-11-01T01:10:00.000+08:00

Hey cool class of TA02!

Let me juz update on watz been happening among our class lately..

HAPPY 18TH BIRTHDAY ROY!

Most of the class celebrated Roy's 18th birthday last Monday. It was a happy occasion woth lots of fun and laughter shared among the class! Let me juz let the pictures do all the talking. A video will be up soon so watch out for it. Meanwhile, enjoy the pictures! :D

Btw, anyone who wants e full set of pictures of Roy's birthday can ask either NAsh or Charissa! :D

Kelly, Jimmy, Ye Ling, Jing Qing, Nash, Shaunn, Clive, Jordan, Roy, Joel and Charissa
*Nash's head is the main focus here..Haha!*

Shaunn - I'm shy..don't look at me, dammit! :D

Roy, Ye Ling, JQ and Nash

*Don't they make a cute family?*

Roy, Charissa and Joel

*Smile people!*

Roy, Kelly and Jimmy

*"We are little angels ready to be eaten up"*

Roy, Clive and Jordan

*Cool guys. Juz chill..*

Tatz all guyz! Byez! Nash out! :D

2007-10-31T23:19:00.000+08:00

Hey Guys!

I juz want to noe if u want to have a class T-shirt for our class as a momento when we leave poly in the future. Class T-shirt or jacket or whatever u guys prefer. What do u guys think? I can help to design! Haha! Feedback me! Tanx! :D

Nash :D

2007-10-28T00:20:00.000+08:00

FMGT qns again! i'll try to post them. hahaa. but if some qns cannot then i oso dno how lah haha.. anyway. take cares everyone!

JING..:)

3-10) What is the purpose of the cash budget? What role does the sales forecast play in its preparation?

3-13) What is the cause of uncertainty in the cash budget and what two techniques can be used to cope with this uncertainty?

3-20) What is the financial manager's objective in evaluating pro forma statements?

2007-10-18T20:59:00.000+08:00

hello people :)
Here's the question for FMGT's tutorial questions from the textbook for the first topic.

Qn 1-10
What are the two primary activities of the financial manager that are related to the firm's balance sheet?

Qn 1-11
For what three basic reasons is profit maximization inconsistent with wealth maximization?

Qn 1-13
What is the goal of the firm and, therefore, of all managers and employees? Discuss how one measures achievement of this goal.

thats all for the review questions!
takecares~

jq

2007-07-31T20:55:00.000+08:00

photo 1

photo 2

photo 3

photo 4

photo 5

photo 6

photo 7

okie.. here r the pics! hahaa.. i onli posted the class pics. if u guys wanna pics can get from me =]

was thinking whether u guys wana hv a vote one the nicest pic? lol

tho they look all the same lah hahaha =p

ok well tats all for now. =]

take cares everyone!

jingqing was here..

2007-06-25T22:30:00.000+08:00

Hey class! I figured it would be interesting if we could rank ourselves in the class according to different categories of so-called "rankings". It can be for a semester or year or month or whatever u guys prefer. Here r the rankings I thought of:

The Gentleman of the Class
The Lady of the Class
The Most Hardworking
A Great Listener
The Most Humorous
A Great Leader
The Most Thoughtful
The Most Bubbly

These r juz some of the rankings I thought of. Any ideas/objections/support to this idea, say it away at this blog! Hope to hear responses from u guys! Tanx!

Nash :D

2007-06-07T23:04:00.000+08:00

FIT MAKEUP LESSON DURING HOLS FOR TUTORIAL WE MISSED...BUT I CANT RMB IS WHICH ONE LOL
anyway. the date is on 18th June, Monday
11 am to 1 pm
72-04-02

hahah ok done. jus helping to pass this msg to convenient u guys! =D
enjoy!!

loves,
jing

2007-06-04T23:49:00.000+08:00

gd lucks again! =D

2007-06-01T23:35:00.001+08:00

WAHAHH

ALL THE BEST TO ALL OF US! HEHEHE :)

2007-02-04T13:27:00.000+08:00

Hey people of TA02! Nash here! Do ur best in the coming examz and celebrate ur Chinese New Year and long holidays with joy and happiness!

Wishing you guys,

ALL THE BEST FOR THE EXAMZ!
HAPPY CHINESE NEW YEAR!
GONG XI FA CAI!
:D

2006-12-22T23:38:00.000+08:00

HELLO TO ALL COOL PEOPLE OF TA02!!!

o!i forgot to mention! i'm CHARISSA!:D

wow wow.
let's see.
what should we blog aboout here.

(trying not to talk about common tests HAHHA)
how are the holidays guys??
having fun??

we should seriously take more photos!!
it's pathetic to only have ONE class photo!!
HAHA.

let's take more!!more more more!!!

anyway, here's photos from our (nash,roy,fidah,de hui,clive and me) lms proj!

2006-12-10T00:05:00.000+08:00

Hello everyone! Nash here! Juz wanna wish u guys..

ALL THE BEST FOR THE COMMON TEST! :D

2006-08-04T20:54:00.000+08:00

Hello people! Juz wanna say that there is a suggestion about a group study on Mondae. However, I do not know who is joining the group study. Who are interested? Blog here or tag! Tanx!

Nash

2006-08-02T14:26:00.000+08:00

Hello everyone! Nash here! Juz wanna say that the blogskin has changed so that everyone can see the whole blog with the whole picture of the class seen clearly with no obstruction or whatsoever. Enjoy!

Juz wanna say that we have really bonded together these past few months and I think that is awesome! We are united as a class! Love u guys! Hope we can maintain our close relationship as a class!

All the best for the examz!
Frenz Forever!

Nash :D

2006-07-20T22:11:00.000+08:00

Hi everyone,heres my first entry officially. Anyway i hope that everyone can visit out class blog to get yourself posted with lastest class updates. Especially for INFA ... I will be posting assigned Qns to the 4 Grps. Visit Visit Visit Visit !!!Here are some photos taken ...

Top: De Hui, Roy , Charissa

Bottom: Fidah, Kelly

Roy, Kelly( Bloated Face )

Charissa ( tasty , HAHAHHA )

Sadly this picture cant be displayed... So just go read other stuff...

De Hui with his middle finger seems

like he want to F*** ( HAHAHAH )

Ok ... more pics next time!

Roy ( 20 July 2006 )

2006-07-14T12:16:00.000+08:00

hope euu all will update occasionally haf funn its a class blog....^^ group study oso not bad.... haf funn everyone

2006-07-14T05:20:00.000+08:00

nashh!!!!!! hahahas.. nice blogg u created!!! thanks yah! =) hmmmmmmm TA02 rock on!! =P

ttfn~ hehexx

JQ~~!!

2006-07-14T05:06:00.000+08:00

hello kelly here!
since microecons and business stats are two majorly super important modules... let's have a study group on mondays before the much dreaded CIP :) erm, maybe from 9-12? whad say you TA02? post your comments please! okthanksbye.