Hp Seg Industries Company Case Study

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Question 1
A) Form the Statement of Cash Flow Statement both of the company such as FN& Company and Hup Seng Industries Company use the same method it is direct method. Indirect method is easier to understand.

Different between the direct method and indirect method is the calculation at Operating activity. Direct methods is calculate the items cash from the customer. A cash outflows such as rent paid and also the cash inflows. As an example, shares form the customers.

Indirect method is difficulty to understand. It present a reconciliation of accrual accounting net income to cash from operating activities and it also record revenues and expenses when it changes to cash. In others word, Converts accrual basis net income figure on the income …show more content…

The Hup Seng Industries Berhad account receivables turnover is 7.34 times per year. That means that the higher that account receivables turnover the faster that company that can get their money back to cover their debts.
The Hup Seng Industries Berhad asset turnover is 1.21. For every dollar that Hup Seng Industries Berhad generates 1.21 cents.
For every 1 dollar liabilities the F&N Company can pay RM2.49 in year 2014 for every 1 dollar liabilities the Company can pay RM 2.16 for the year 2014
Hup Seng Industries Berhad have 0.31 debt. The ratio above 1:0 indicate that the Company have more debt than asset. The 0.45 or 0.45:1 means that the creditors of the Company provides 45cnts of the asset for each of $1 of asset.
The Hup Seng Industries Berhad can pay RM0.36 for each dollar of Company revenue is available to cover their other expenses. The Hup Seng Industries Berhad net profit is 14% means that every $1 sale that the company contributes that 14% towards the net profits of the business.
The Hup Seng Industries Berhad only provide the 22.74% on the return on asset. It means that Hup Seng Industres Berhad earn 22.74% for their overall

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