a.
Rachel's cash % is 4.5% and the chains % is 6.7%. It is higher.This may Rachel
is spending more money on services to help the restaurant and has less Cash assets than the chain. It is important for Rachel to know the different
percentages. "there are a variety of important reasons why managers must
be able to read and analyze their own balance sheets to determine items such as
the current financial balances of cash, accounts receivable etc." (117)
b.
Rachel's Inventory percentage is 2.7% and the chain's is 1.3%, which is
higher, this goes along with the fact
Rachel may be spending more money on things such on inventory for her
restaurant. " In most hospitality industry situations, the value of
an inventory item will equal the amount the business paid for
it." 124.
c.
Rachels accounts Payable percentage is 11.3% and the chains is 10.50%. This is
higher. This could mean that Rachel is also buying more inventory (produce and
ingredients) than the chain average, so she owes more money to her suppliers.
"Accounts
payable represents the amount of money owed by the
business to others (such as suppliers), and as a result is considered
to be one of that business’s liability accounts." 37.
d.
Rachel's Notes Payable % is 2.5%, the
chain’s % is 1.5%. This is higher. This means that Rachel has more company
liabilities than the chain average.
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