Change in Accruals = [(NI-OCF) + Average Assets)-[(NI₁-1-OCF₁-1) + Average Assets. In June 2004, InfoSonics Corp. went public in an initial public offering (IPO), a transaction wherein a company sells its shares to the public for the first time. Per InfoSonics IPO prospectus, their Revenues increased by 40% and their "Change in Accruals" metric was +58%. In February 2004, Kinetic Concepts Inc. went public in its IPO. Per Kinetic Concepts' IPO prospectus, their Revenues increased by 32% and their "Change in Accruals" metric was -48%. What might InfoSonics' metric of +58% suggest / be a hint of? What might Kinetic Concepts' metric of -48% suggest/ be a hint of?
Change in Accruals = [(NI-OCF) + Average Assets)-[(NI₁-1-OCF₁-1) + Average Assets. In June 2004, InfoSonics Corp. went public in an initial public offering (IPO), a transaction wherein a company sells its shares to the public for the first time. Per InfoSonics IPO prospectus, their Revenues increased by 40% and their "Change in Accruals" metric was +58%. In February 2004, Kinetic Concepts Inc. went public in its IPO. Per Kinetic Concepts' IPO prospectus, their Revenues increased by 32% and their "Change in Accruals" metric was -48%. What might InfoSonics' metric of +58% suggest / be a hint of? What might Kinetic Concepts' metric of -48% suggest/ be a hint of?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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6.
![7. Change in Accruals = [(NI,-OCF,)+ Average Assets,]-[(N4.1 -OCF-1) + Average Assets, ]
%3D
In June 2004, InfoSonics Corp. went public in an initial public offering (IPO), a transaction
wherein a company sells its shares to the public for the first time. Per InfoSonics' IPO
prospectus, their Revenues increased by 40% and their "Change in Accruals" metric was
+58%. In February 2004, Kinetic Concepts Inc. went public in its IPO. Per Kinetic
Concepts' IPO prospectus, their Revenues increased by 32% and their "Change in Accruals"
metric was -48%. What might InfoSonics' metric of +58% suggest / be a hint of? What
might Kinetic Concepts' metric of -48% suggest/ be a hint of?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2ea20ba8-ef30-4b82-9f97-84d2418b8c8d%2Fde87b693-5434-470e-b6a8-69f1d26196fd%2Fo3lsst9_processed.jpeg&w=3840&q=75)
Transcribed Image Text:7. Change in Accruals = [(NI,-OCF,)+ Average Assets,]-[(N4.1 -OCF-1) + Average Assets, ]
%3D
In June 2004, InfoSonics Corp. went public in an initial public offering (IPO), a transaction
wherein a company sells its shares to the public for the first time. Per InfoSonics' IPO
prospectus, their Revenues increased by 40% and their "Change in Accruals" metric was
+58%. In February 2004, Kinetic Concepts Inc. went public in its IPO. Per Kinetic
Concepts' IPO prospectus, their Revenues increased by 32% and their "Change in Accruals"
metric was -48%. What might InfoSonics' metric of +58% suggest / be a hint of? What
might Kinetic Concepts' metric of -48% suggest/ be a hint of?
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