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Fiscal Report 2013
The treatment and analysis of fiscal presentation of Rainbow Paint Company delivers an feeling of the business’s fiscal activities for the financial twelvemonth ended December 31, 2013. Fiscal analysis offers the strong position of the everyday dialogues of a concern. It assists in measuring the present, every bit good past public presentation. This analysis is a significant tool for the concern, shareholders, every bit good as the others who deal with Rainbow Paint Company.
- The liquidness of the company is accurate as established by the current ratio, speedy ratio, working capital.
- Current Ratio stands at 2.0
- Quick Ratio stands at 1.0.
- Working Capital stands at $ 750,000.
- The figure of yearss engaged to roll up receivables is half of the clip taken in selling the stock list.
- Histories Receivable Turnover stands at 13.3 yearss
- Number of Days’ Gross saless in Receivables bases at 27.4 yearss
- Inventory Turnover stands at 5.67 times.
- Number of Days’ Gross saless in Inventory bases at 64.4 yearss.
- In footings of solvency, the company’s place is non really strong as the company is keeping an equal proportion of debt in comparing to equity.
- Ratio of Fixed Assets to Long-term Liabilities stands at 1.7
- Ratio of Liabilities to Stockholders Equity stands at 1.0.
- Number of Times Interest Earned bases at 6.2
- Number of Times Preferred Dividends Earned bases at 6.1
- The profitableness of the company during the twelvemonth was sensible, as it was non excessively high and at the same clip non excessively low. The net incomes per portion on common stock was $ 4.10 per portion.
- The market public presentation of the company was besides appropriate. The company was able to administer dividends of $ 0.90 per portion of common stock, and keep the price-earnings ratio of 6.1.
President’s Letter to Shareholders’
Good afternoon Stockholders,
I trust this missive will happen you all good. In the past twelvemonth our organisation has been really active and enclosed you will happen the inside informations of the study.
A few points that were concentrated on by the board of managers ; in order to reenforce our organisation:
- Review and update fiscal coverage
- Addition of a codification of behavior and struggle of involvement policy
- Development and rewriting of an organisational program
Ultimately, we all agreed that the hereafter of Rainbow Paint Company is really bright and in order to go on the betterment we believe it is indispensable, to run as efficaciously and expeditiously as possible. As we head into the approaching twelvemonth, we propose to cut down our liabilities and increase our assets. With the execution of new attacks, we will be able to put to death beef uping our balance sheet and generate production growing. Thus, making more net incomes on capital and significantly better stockholder returns, along with a stronger hard currency flow.
Presently, we have cardinal developments that are turn outing to be outstanding. The new resources introduced will let for a durable primer, which is the same colour, as the colour being applied, leting for less coats and longer lasting and vivacious colourss. We’ve besides invented new colourss forcing us in front in the industry and doing our trade name a family name every bit good as being the most preferred in most locations around the state. These enterprises are merely the beginning of many new enterprises to be applied in the coming twelvemonth, leting for a stronger and steadier fiscal place.
Another enterprise to look frontward to let the consumer to make their ain personalized colourss at the shop, every bit good as the colour lucifer to anything they bring in. We have had a test tally and had an outstanding success. We will be turn overing out this new enterprise, at other shop locations later this twelvemonth, once we have established the necessary equipment in all the vicinities.
The new twelvemonth is full of prospective ideals and we are come ining it, with the utmost assurance that with the new ideals we will be booming good into the hereafter. The twelvemonth 2013 was a great betterment from 2012 and we are looking to be exceptionally strong in future old ages. We are looking frontward in doing Rainbow Paint Company the preferable pigment for places and flats, with sensible monetary values and assorted new colourss.
With the new enterprises we are projecting that the first one-fourth will convey a strong upward manner and with the economic system bit by bit calming we are gauging farther growing into the 2nd and 3rd quarters with an outstanding 4th one-fourth to convey in 2014. Along with the new enterprises, we will go on to better employee grasp and contentment. With the enterprises combined with employee betterments and trade name enlargements, we believe that we will be in a strong fiscal place throughout 2014 and good into 2015. With employee and client fidelity, every bit good as increasing our mass circulation and presenting to more locations we will be able to carry through all our ends.
We want to take this chance to widen our grasp to our employees and clients. For without our employee’s enthusiasm and productiveness and the trueness of our clients, we would non hold been able to accomplish these ends, in 2013. As we roll into 2014, we strive to go on bettering employee dealingss and supply exceeding merchandises and client service to our clients.
Rainbow Paint Company
Management Discussion & A ; Analysis
The Management’s Discussion and Analysis of Rainbow Paint Company utilizes the cardinal public presentation steps to supervise the fiscal wellness and public presentation of Rainbow Paint Company’s fiscal consequences for the period ended December 31, 2013. The undermentioned fiscal statements and notes to histories are prepared harmonizing to appropriate rules and processs. All sums are stated in dollars unless noted otherwise.
The treatment contains a few statements that may be “forward-looking statements” . All studies in the treatment, other than statements of historical facts, are called “forward looking statements, ” since we have used what we know and expect today to do a determination about the hereafter. The company trusts that the chances, bing in forward looking statements are on the footing of rational outlooks. The statements do non supply confidence about future presentation and the existent results or growing may change well from those stated in frontward looking statement.
Forward looking statements contain the footings like: anticipate, program, expect, budget, and believe or other like footings. Issues that could ensue in the difference between existent results and advanced statements contain market monetary values, guidelines of authorities refering chemical use, sustained handiness of money, funding and general economic, and market or corporate fortunes. Investors are alerted once more that any such studies do non assure the extroverted public presentation and that the existent results or growing may non be same as those projected in the advanced statements.
The growing in the gross revenues in the last few old ages was moderately of import, but the growing in net income was non relative to development in gross revenues. The addition in net income was merely 16 % , whereas the growing in gross revenues was 56 % . The rise in disbursal is due to the rise in involvement disbursal. Therefore, the corporation is scheduled to put some of its ain money and put up the new equipment in the hereafter. This will diminish the budget of fabricating the merchandises and services in future.
It is projected that hard currency modesty for the concern will lift in future due to growing in gross revenues and hence the hard currency dividend is likely to lift in future. The new equipment has been fitted and with this new equipment, a new run of pigment merchandises is anticipated to be announced. This shall be the new line of pigment specially made for the honeymooners. This will be announced as environment friendly, easy removable pigments which can be used by the honeymooners to adorn their room in different subjects. This is anticipated to raise the gross of the concern by 0.3 times.
Rainbow Paint Co. ‘s comparative fiscal statements for the old ages stoping December 31, 2013 and 2012 are as follows. The market monetary value of Rainbow Paint Co. ‘s common stock was $ 30 on December 31, 1999 and $ 25 on December 31, 2013 ( Accounting ) .
( Accounting )( Accounting )( Accounting )
2011 Annual Report. ( 2011 ) . Retrieved March 28, 2014, from Sherwin Williams: hypertext transfer protocol: //investors.sherwin-williams.com/pdf/annual-reports/2011_annual_report.pdf
Accounting, A. B. ( Ed. ) . ( n.d. ) .AC499 Unit 4 Rainbow.pdf.Retrieved March 30, 2014, from Kaplan University.
Warren, C. S. , Reeve, J. M. , & A ; Duchac, J. E. ( 2012 ) . Fiscal statement analysis. Mason, Ohio, USA: South-Western Cengage Learning. Retrieved March 28, 2014