EBK FOUNDATIONS OF FINANCE
10th Edition
ISBN: 9780135160473
Author: KEOWN
Publisher: PEARSON CO
expand_more
expand_more
format_list_bulleted
Question
Chapter 14, Problem 1RQ
Summary Introduction
To discuss: Effect of seasonal changes on delivery business while
Expert Solution & Answer
Explanation of Solution
During the holiday seasons, the delivery volumes tend to peak.
Company U needs investment in working capital in order to operate its operations. It requires increased storage space, vehicles for distribution, and criteria for temporary staffing. Such factors lead to an increase in working capital requirement.
The peak season has to be accounted for when forecasting the financing requirements of the company so that there is no disruption in the business and deliveries are completed on time. In particular, the following factors must be taken into account in the forecast:
- Increase in staff: Temporary staff can be recruited during peak season, which raises wage expense.
- Increased storage space: Increases the cost of rent.
- Increase in delivery vehicles: These can be rented, which increases the cost of operations.
Want to see more full solutions like this?
Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!
Students have asked these similar questions
What are a few of the typical financing activities for a company like United Parcel Service, Inc. (UPS), the world’s largest package delivery company and a leading global provider of specialized transportation and logistics services?
Need help with the calulation
Compare the Logistics Performance Index (LPI) measured by the World Bank in Canada to that of
the country in question. (India & Germany) Use APA citation for sources used.
Chapter 14 Solutions
EBK FOUNDATIONS OF FINANCE
Ch. 14 - Prob. 1RQCh. 14 - Discuss the shortcomings of the percent of sales...Ch. 14 - Prob. 3RQCh. 14 - Prob. 4RQCh. 14 - Prob. 1SPCh. 14 - Prob. 2SPCh. 14 - (Financial forecastingdiscretionary financing...Ch. 14 - (Financial forecastingpercent of sales) Next years...Ch. 14 - Prob. 5SPCh. 14 - (Percent of sales forecasting) Which of the...
Knowledge Booster
Similar questions
- Briefly explain the significance of supplier financing siting the impact it has on US financing for companies.arrow_forwardPlease follow the following steps to conduct the financial analysis of Pharmamax: 1. Enter the attached financial statements into a New Excel and make sure that the numbers have been entered correctly so that you may upload it after you have completed the entire assignment. 2. Write an introduction that gives a brief outline of the Palestinian pharmaceutical sector. Include critical information regarding the industry's market size, competitive landscape, export- import dynamics, and regulatory frameworks, 3. Construct a cash flow statement for Pharmamax using the attached financial statements. This needs to he done using both the direct and indirect methods. 4. Analyse the Pharmamax attached financial statements, including the cash flow statement, using the following tools: a) Financial ratios(all the ratios covered in class) of pharmamax and those of the Palestinian pharmaceutical company of your choice. b) Vertical common-size analysis: to understand the relative proportions of…arrow_forwardWhat would be the brief breakdown of the financial requirements to startup food truck in londonarrow_forward
- Give an example of how general economic trends would affect sales forecasting in the airline industry.arrow_forwardBalance of payment data is used by various stakeholders, including society. What is your opinion regarding the need of preparing balance of payment? Critically analyze your statement. Do you agree that balance of payment is just one sided story of a transaction and it gives only cash position of a country by the year end? The BOP surplus or deficit positions have specific meanings. Critically analyze the BOP positions with proper justification.arrow_forwardAggregate expenditure is the sum of a. spending by households, firms, government, and foreigners on final goods and services b. all types of spending by households c. spending and savings by households d. spending by households and governments on final goods and servicesarrow_forward
- explain how syndicated loans are used in international markets.arrow_forwardWhat is the primary source of external financing for businesses in North America? Explainarrow_forwardBurchill Consultants is a global consulting firm. The firm has a travel policy that reimburses employees for the "ordinary and necessary" costs of business travel and reimburses business-class airfare for international and "long" domestic flights. Associates at the firm often mix a business trip with pleasure by either extending the time at the destination or traveling from the business destination to a nearby resort or other personal destination. When this happens, an allocation must be made between the business and personal portions of the trip, so that only the business portion is reimbursed. However, the travel policy is unclear on the allocation method to follow. Consider this example. An employee obtained a business-class ticket for $8,557 and traveled the following itinerary. From Los Angeles Singapore Sydney To Singapore Sydney Los Angeles Miles 8,770 3,908 7,488 One-Way Regular Fare $ 3,396 2,150 3,618 On the date of the flights between Los Angeles and Singapore (and return),…arrow_forward
- Burchill Consultants is a global consulting firm. The firm has a travel policy that reimburses employees for the "ordinary and necessary" costs of business travel and reimburses business-class airfare for international and "long" domestic flights. Associates at the firm often mix a business trip with pleasure by either extending the time at the destination or traveling from the business destination to a nearby resort or other personal destination. When this happens, an allocation must be made between the business and personal portions of the trip, so that only the business portion is reimbursed. However, the travel policy is unclear on the allocation method to follow. Consider this example. An employee obtained a business-class ticket for $8,557 and traveled the following itinerary. From Los Angeles Singapore Sydney To Singapore Sydney Los Angeles Miles 8,770 3,908 7,488 One-Way Regular Fare $ 3,396 2,150 3,618 1. Business portion of the airfare 2. Business portion of the airfare On…arrow_forwardWhat is a sensible credit period? Should the credit period for your company's sales vary depending on the industry in which you are operating?arrow_forwardWhat information would one use to determine the type of economic system that a country has? (Multiple choice) 1. The information needed would be the rate of inflation and the gross domestic product figures. 2. The information needed would be the breakdown on who owns the business in the country and how much control the government has upon business regulations, taxes, etc. 3. The information needed would be the gross domestic products figures and consumer price index figures.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
