Case study of financial reporting system, case study of financial management

Xintiandi company produces two kinds of products: A and B. Variable costs such as materials and wages can be divided by product, and fixed costs such as depreciation can be allocated to both products in a fixed proportion. Production workers can be moved between the two products according to their tasks.

It takes 32 hours to process product A and 64 hours to process product B. The annual design and production capacity of product A is 1000 pieces, and the annual design and production capacity of product B is 600 pieces. Sales are basically fine.

The production and sales information of the plant in 2014 is shown in Table 1.

Xintiandi Company's EBIT Statement.

aProducts. bProducts.

Total. Production and sales volume (pieces).

Total sales revenue.

Total variable costs.

Total fixed costs.

EBIT.

Profit margin on sales.

The general manager of the company believes that the production of product A is more profitable than the production of product B, and the sales profit margin is high, so more product A should be produced. Therefore, in 2015, the production plan was adjusted, and 900 pieces of product A were arranged to be produced, and 400 pieces of product B were produced, and some of the workers who originally produced product B were transferred to the production of product A. At the end of 2015, the information on production and sales is shown in Table 2.

Xintiandi Company's EBIT Statement.

aProducts. bProducts.

Total. Production and sales volume (pieces).

Total sales revenue.

Total variable costs.

Total fixed costs.

EBIT.

Profit margin on sales.

The general manager was puzzled by this result, the cost level in 2014 and 2015 did not change, why did the company's total profit and total sales profit margin decline after producing more high-profit A products? How will the production plan for 2016 be formulated? What is its expected profit?

A complete list of financial statement analysis cases.

2012 latest.

FYI, word format.

1. Main financial indicators.

The main financial indicators include: solvency index, asset and liability management ability index, profitability index, growth ability index and cash flow index. Side-to-side.

1) Solvency indicators.

Short-term solvency indicators.

Short-term solvency is the ability of an enterprise to repay its current liabilities in the next year, and is an important indicator of whether an enterprise's financial condition is healthy. Corporate creditors, investors, raw material units and other users of Tongqipi are usually very concerned about the short-term solvency of enterprises.

Liquidity ratio. Current Ratio = Current Assets Current Liabilities.

The higher the value of this indicator, the stronger the short-term solvency of the enterprise. The value of this indicator is generally 2.

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