Finance for Manager (Finance) Assignment Example | Topics and Well Written Essays - 5000 words

Finance for Manager (Finance) - Assignment ExampleHere the study also involves a elaborate insight into the duties of the financial manager in the company and again recommendations have been veritable on the basis of three main factors, i.e. aid planning, tick and exercise management in the future. The report also discusses the possible source of finance for the recent investment proposal that the company is currently considering. Here the main strain is on loans as a source of finance however two more sources of finance have also been included as alternatives for the company. Before paltry into the current financial condition of the company and psychoanalysis of the company, it is crucial to discuss in brief the overview of the company. Overview of Company Jools Furniture was started twenty one days ago and in 1995, the company went on to becoming manufacturers of kitchen and bedroom furniture and within ten years since then, the company went on to expand and have closely 15 0 different furniture products. The company has grown since then and now it majorly consists of four main divisions, i.e. Kitchen, Bedroom, Quality and Office departments. The company employs as many as over 500 employees. Although the company has received a number of options to go public, the owner Smith Brown prefers to keep the company under his complete control hence the public offers have been declined. The next section will detail an analysis of the current financial condition based on which recommendations have been developed for the company. Jools Current Financial Condition In order to conduct an analysis of the companys financial position, ratio analysis has been adopted here. The ratios analysis has been conducted in four main types, i.e. profitability ratios, efficiency, liquidity, and financial structure. Each of these has been discussed in detail below. lucrativeness Considering the net profit margin of the divisions, it has been noted that each of the divisions has shown long difference. The table below provides a clear insight into three main ratios here, i.e. gross profit margin, net profit margin, and cash in ones chips on equity (Broadbent & Cullen, 2003). hitability Ratios Year 2009 2008 2007 Quality Products Division Gross Profit margin 41.37% 40.45% 38.91% Net Profit Margin 3.36% 1.98% -9.90% Return on Equity 9.99% 5.63% -26.30% Kitchen Division Gross Profit Margin 37.61% 36.20% 39.22% Net Profit Margin 3.51% 3.27% 4.97% Return on Equity 11.54% 11.65% 16.73% Bedroom Division Gross Profit Margin 29.78% 31.44% 26.37% Net Profit Margin 3.22% 3.27% 2.48% Return on Equity 11.86% 13.35% 12.85% Office Supplies Division Gross Profit Margin 36.97% 33.64% 38.90% Net Profit Margin 4.86% 4.64% 5.53% Return on Equity 13.38% 12.05% 13.55% Considering the return on equity, it is evident from the results that the Quality products division has seen an improvement as compared to 2007 (-26.30%), the division seems to be stabilising itself currentl y. The Kitchens Division on the other hand has been facing a decline in all of the ratios which does not provide a good insight into the performance of the division