Allied Products Inc. Essay Example

can I sell it elsewhere? Or will you be stuck with specialty/customized products and no market?

If you perform a transaction, how essential is that transaction to this company's continuing business? Is the transaction essential to their ability to make sales? The more essential your transaction is to their business, the more likely they'll find a way to pay you. You will need to weigh the difference between loosing the company by refusing open account terms, against the lost revenues if the company fails to pay. Also factor in the long- term benefit of customer loyalty, should you opt to support the company through a difficult period. . Considering the urgency of the decision, would you still call for additional data or checking to be able to make Judgment? If so, what additional data and checking you require first before deciding on the matter? Yes, definitely I would like to call for additional data in spite of of the urgency of the decision. I would like to request a track record of profitably owning and operating the same sort of business. Provide bios of all management especially they are a start-up business.

And their financial statement, for start-ups their sales forecast can be presented. By simply suggesting a lower amount of supply or changing the terms of the credit, the credit credibility of the lender. Offering the client a lower amount of supply in a practical way can make the borrower more likely able to pay the credit that he or she is about to avail. This may lower the chance of having losses or make the client able to pay the credit. Tout ten

terms, Prolonging ten terms may soot n ten lender on ten cereal nee or sense about to lend.

You can't expect to have a client a profit within a short period of time or them to pay you back the credit. 4. What analytical procedures would undertake you to reach a decision? Previous questions, past records and transactions are vital evidences of the credibility of the company to be able to pay out their credit. Analysis of the Financial Statement is an important requirement because it reflects the personality of a company and it is a source of information that will foretell whether they can fulfill their obligations.

Financial ratios can help to undertake to reach the decision. The use of liquidity ratios which are given the ability to see if they can pay off their debts that are maturing within a year. The Debt Management Ratios gives an idea on how the firm has financed its assets. And Profitability Ratios gives an idea on how profitable the firm is operating. Also, having them oblige to submit legal requirements to know if their operations are lawful and requiring them to issue promissory notes or post- dated checks, for us to have something that would drive them to pay their obligations.