Financial Detective
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Financial Detective Case Summary
The main issue we are facing is how to identify companies based upon brief descriptions and financial statements given to us. We tackled this issue by first reading the descriptions of each company and then determining what specific data would be relevant and correlate with such descriptions. Below we have identified each company in all four industries and provided evidence backing our findings.
Paper Products- For the paper products section we have determined the company I is the worlds largest maker of paper, paperboard, and packaging. Company J is is the small producer of printing, writing, and technical specialty papers. The supporting evidence is Company I having higher ratios of long term debt and lower cost of goods sold due to cost containment initiatives. Company J has higher inventory due to purchasing wood fibers used in is paper making processes.
Hardware and tools – We concluded that Company K is the global manufacturer of power tools and accessories. Company L manufactures and markets precision tools and diagnostic systems. The supporting evidence shows that Company L had higher receivables from providing financing to customers and higher SG&A costs due to is specialized sales methodology. Company K retained higher long term debt due to its size requirements needed for effective international business practices.
Retailing – We determined that Company N is the rapidly growing upscale discount store. Company M is the nationally advertised general merchandiser. The supporting evidence showed that company M had higher inventory turnover because of their volume oriented sales strategy. Company N had higher cash and investment from divesting in discount store, also they have longer receivable days due to them extending credit lines to qualified customers.
Newspapers – The data showed that Company P was the diversified media company. Company O was the small regional newspaper company. The supporting evidence showed that company O had higher intangibles due to goodwill acquisitions of regional newspapers. Company P had higher SG&A due to advertising demands of its global operations, along with higher fixed assets associated with building a large headquarters office.