Assignment 1: DiscussionCase Study: General Machinery, Ltd

Ratio analysis is a method used to analyze the financial reports of a company and interpret trends in the company's performance. As a nonaccounting manager, you use numerous ratios to analyze your company's performance year-by-year and benchmark the performance to industry averages, to an individual competitor's performance, or against a predetermined target.

For this assignment, read "Case study question 7.2: General Machinery Ltd" on page 168 in chapter 7 of our textbook, Accounting for Managers: Interpreting Accounting Information for Decision Making. Using the data from the case study, repond to the tasks below.

Tasks:

Consider the following scenario for this assignment: You are an external investor who is considering General Machinery as one of the potential companies for investment. Respond to the following in your initial discussion post:

1. Discuss the major issues facing the company.
2. Recommend what actions the company should take to improve its overall performance, addressing each of profitability, liquidity, gearing, activity, and shareholder return measures.
3. In what way does the Statement of Cash Flows help you to interpret the ratios and financial performance of the company?
4. What information does ratio analysis provide for meeting the requirements of the case questions?
5. Which ratios are the most important, and which ones are of limited value? Justify your choices for the scenario.
6. Why do you need to compare:The current year ratios with the prior year ratios?
7. The ratios of competitors in the same industry or some other benchmark?
8. Other than the computations used in ratio analysis, what else is necessary to properly analyze a company for investment?

Submission Details:

By Saturday, May 13, 2017, post your response to the Discussion Area. Through Wednesday, May 17, 2017, read and respond to at least two other classmates' posts on at least two different days of the week.

Write your initial response in 300500 words. Your response should be thorough and address all components of the discussion question in detail. Include citations of all sources, where needed, according to the APA style, and demonstrate accurate spelling, grammar, and punctuation.

Apply the following when responding to your peers:

• Read your peers answers.
• Provide substantive commentsto at least 2 peers' posts on 2 different days by
• building on the remarks or questions of others; or
• sharing practical examples of key concepts from your professional or personal experiences
• assist the class in providing excellent answers to each of the posted questions.
• Respond to feedback on your posting and provide feedback to other students on their ideas.
• Note: more posts on more days each week will support your discussion grade.
• Make sure your writingis clear, concise, and organized;
• demonstrates ethical scholarship in accurate representation and attribution of sources; and
• displays accurate spelling, grammar, and punctuation.

Grading Criteria

Assignment ComponentsMax Points

Initial response was:

• Insightful, original, accurate, and timely.
• Substantive and demonstrated advanced understanding of concepts.
• Addressed each of the seven (7) Tasks prompts.
• Compiled/synthesized theories and concepts drawn from a variety of sources to support statements and conclusions.

25

Discussion Response and Participation:

• Responded to a minimum of two peers in a timely manner on at least two different days during the week.
• Offered points of view supported by research.
• Asked challenging questions that promoted discussion.
• Drew relationships between one or more points in the discussion.

15

Writing:

• Wrote in a clear, concise, formal, and organized manner.
• Responses were error free.
• Information from sources, where applicable, was paraphrased appropriately and accurately cited.

10

Total:50