BUS 687 - Week 2 - Assignment - Q1-20 QBR.pdf - Student...

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Page 1 of 7Student: Tracie BowleyQ1-20 QBR5 Key Learnings from QuarterOne of the top things I learned this week involved accounts receivable. According to Biery(2013), companies can collect more cash “many don’t realize it because they don’t look at theirfinancial statements. If they did, they might see several weeks’ worth of sales sitting on the balancesheet in accounts receivable” (para. 3). By changing the terms, a company can increase their inflowof cash. This also seems to reduce the amount of time it takes for buyers to pay the company for theproducts. After learning this, I changed the term of Hisco's accounts receivable. This created animmediate cash inflow of over $90.000 during the same quarter that the changes were made.Another thing I learned this week was to the value that dashboards provide. Dashboards areoften graphical (visual) representations of key information that needs to be reviewed, interpreted,and analyzed. Dashboards provide a visual way to identify key variances. "Displaying targetsalongside actual performance on a graph helps tell an interesting story about different parts of anorganization: revenues, expenses, program results" (Pal, 2015, para. 6). For example, my pre-taxnet income dashboard shows what was planned and what actually happened during the period. Thevisual representation pointed out that the industry saw growth while the company saw a slightdecline in market share. It also showed that the base cost was more than I had planned. This led toto look further into the base costs in order to determine why the costs were different than planned.While the Annual Net Income is within Mr. Sloane's targeted range, the company is alsoincreasing its debt. Increasing debt is not always a bad thing, but it can become a slippery slope if itis left unchecked. Mr. Sloane set a target of $300,000-$400,000 for Hisco's annual net income. Iwas able to end the year with a net income of just under $400,000. With this net income, Hisco'sdebt is estimated to increase by more than $300,000. The concern is that the company continues toacquire more debt simply to make a net income of a little more than half the debt value. Throughoutthis year, I need to keep a close eye on the debt amounts in order to control those amounts. Whilethe idea is to achieve a target net income, it should not occur with the company being in seriousdebt.A fourth thing I learned involves finished goods inventory. I realize that I need to keep a closeeye on finished goods inventory. Hisco is charged 8% of the value of finished goods that are kept ininventory. While it is understandable that the company wants to keep a finished goods inventory incase there is market share increase, this excess inventory is costly. In addition, when R&D projects
Page 2 of 7Student: Tracie Bowleyare completed, it is likely that finished goods in inventory will need rework. This rework cost willvary depending on what needs to be adjusted on the readers, but it does create an additional cost thatis not necessary and should be reduced.

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