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Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell
Edition 10ISBN: 978-1259179396Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell
Edition 10ISBN: 978-1259179396 Exercise 8
Surviving Rapid Growth
Glasspray Corporation is a small firm that makes industrial fiberglass spray equipment. Despite its size, the company supplies a range of firms from small mom-and-pop boatmakers to major industrial giants, both overseas and here at home. Indeed, just about every molded fiberglass resin product, from bathroom sinks and counters to portable spas and racing yachts, is constructed with the help of one or more of the company's machines.
Despite global acceptance of its products, Glasspray has repeatedly run into trouble with regard to the management of its current assets and liabilities as a result of extremely rapid and consistent increases in year-to-year sales. The firm's president and founder, Stephen T. Rose, recently lamented the sad state of his firm's working capital position: "Our current assets aren't, and our current liabilities are!" Rose shouted in a recent meeting of the firm's top officers. "We can't afford any more increases in sales! We're selling our way into bankruptcy! Frankly, our working capital doesn't!"
What are some management techniques applied to current liabilities that Glasspray might use to improve its working capital position?
Glasspray Corporation is a small firm that makes industrial fiberglass spray equipment. Despite its size, the company supplies a range of firms from small mom-and-pop boatmakers to major industrial giants, both overseas and here at home. Indeed, just about every molded fiberglass resin product, from bathroom sinks and counters to portable spas and racing yachts, is constructed with the help of one or more of the company's machines.
Despite global acceptance of its products, Glasspray has repeatedly run into trouble with regard to the management of its current assets and liabilities as a result of extremely rapid and consistent increases in year-to-year sales. The firm's president and founder, Stephen T. Rose, recently lamented the sad state of his firm's working capital position: "Our current assets aren't, and our current liabilities are!" Rose shouted in a recent meeting of the firm's top officers. "We can't afford any more increases in sales! We're selling our way into bankruptcy! Frankly, our working capital doesn't!"
What are some management techniques applied to current liabilities that Glasspray might use to improve its working capital position?
Explanation
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The firm can improve its working capital...
Business 10th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell
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