World Religions and Places of Worship

Religious expression The statement of â€Å" Money should be spent helping people, not decorating a place of worship† is a very controversial one. It could either be true or false, depending on the place, time and size of the church. It is completely true that the money used for decorating a place of worship such as a church or a mosque could be better-spent helping people as mentioned in the previous statement. However, I agree and disagree with this statement to certain extents.I agree because, taking Christianity and churches as an example, it is taught in the bible that modesty is an important aspect of life that must be met. However, many churches seem to do the exact opposite. Decorating their walls with paintings, using stained glass windows and placing gold crosses within the church. Other religions such as Islam also spend a lot of money on the interior and exterior decoration of mosques. Filling them with golden calligraphy and a number of minarets that are all expen sively done.This money could have been used to help the less fortunate and other people who are in need of financial aid. I disagree due to the following reasons; firstly with places of worship being fancily decorated, expensively or not, it increases the amount of respect people have to that place. It also shows respect to, in some religions, god or the person of worship for that religion. Taking the Notre Dame as an example, the amount of money it brings to the tourism of France is extremely high. People visit it for pilgrimage, examining its intricate architecture and design and even to repent.The extra money this church brings in could help the less fortunate in many ways. Thus proving the previous statement controversial. Secondly, the aim of showing god the sacrifices and financial efforts that were made to his satisfaction and in satisfaction of his worshipers. This reduces the effect that the statement has on the decoration of places of worship. In conclusion, I both agree a nd disagree with the statement of â€Å" money should be spent helping people, not decorating a place of worship†.Due to the numerous reasons and examples above and taking into consideration the main point of money that could have been spent helping people, spent on decorating a church that would positively impact the economy of a country and then helping people. The statement could work both ways, and if the place of worship was properly decorated, attracting enough people to it, it can gain enough money to help people in need of help and improving their lives from all aspects is possible.

Promoting Health and Well-being

The aim of this assignment is to carry out a health promotion campaign on an area that I feel is being publicised regularly in the media. The area that I have chosen is binge drinking as it is growing concern in today's society and by carrying out this campaign I hope to raise awareness within my chosen target group. I will look at the different aspects on binge drinking and the different campaigns undertaken by the government in order to control binge drinking. I will carry out both primary and secondary research in order to devise my health promotion campaign. What is binge drinking? There is no actual definition of the term ‘binge drinking' although it is usually defined as drinking more than half the recommended weekly intake in one session. It is important to recognise that the majority of people do not consider themselves to be binge drinking as they may be oblivious to the recommended weekly allowance or they may be on a night out and do not realise that they are binge drinking/. People ‘binge drink for many reasons but it often caused by: * Peer pressure from friends * To escape from the pressures of life in order to relax. * To increase self confidence and self esteem to deal with social situations * To have fun Binge drinking is also drinking with the intention of getting drunk, drinking as much as possible in a short pace of time and also to the point in which you lose control. Binge drinking is caused by the decrease of alcohol prices so people are able to afford more. Also most people today have an increased disposable income to which they are able to spend anywhere, and most people feel spending it on drink it beneficiary. Drinking surveys in the UK normally define Binge drinkers as men drinking eight or more units of alcohol in one drinking session and for a woman it would be six or more units. This is double the maximum recommended ‘safe limit's' for men and women respectively. Many experts and institutions now use this as a definition of binge drinking. The ‘National Institute of Alcohol Abuse and Alcoholism' defines binge drinking as a pattern of drinking that brings a person's blood alcohol concentration (BAC) to 0.08 grams percent or above. Below is a graph that shows the results of a survey carried between 1998 till 2005 of the percentage of people drinking more than the daily number of units of alcohol: (www.sirc.org/publik/binge_drinking.shtml) (www.sirc.org/publik/binge_drinking.shtml) Read also Six Dimensions of Health Worksheet From this graph we can see that a higher percentage of men drink more than the recommended daily number units of alcohol than woman. But in 2004 we can see that the percentage of men binge drinking has decreased and the percentage of women has slightly decreased. Statistics: Binge drinking has become more and more common in today's society especially with college students as it has become the norm that they go out and get drunk on a typical night out. Below are few statistics that I have found on binge drinking: ‘Joseph Rowntree Foundation found that over 50% of 15 to 16 year-olds have participated in binge drinking, and another report showed that 44% of 18 to 24-year-olds are regular binge drinkers.' (http://www.thesite.org/drinkanddrugs/drinking/problems/bingedrinking) â€Å"Almost one in every six female drinkers aged over 16 now drinks more than double the recommended daily amount of three units,† the Joseph Rowntree Foundation found. (http://findarticles.com/p/articles/mi_6783/is_2009_May_6/ai_n31616613/ These statistics are very shocking as at the age of 16 girls should not be consuming alcohol never mind drinking the double daily amount of recommended units. This shows that there are no barriers to the age that young people will start experiencing alcohol ‘one third of fourteen year olds and half of fifteen years are drinking alcohol weekly' (www.bbc.co.uk/insideout). If they are doing this now at such a young age then this could lead to serious implications with their health in later years. Two in three of the 1,600 under-18s who needed medical treatment after drinking binges last year were girls. (http://www.mirror.co.uk/news/top-stories/2009/03/22/binge-drinking-shame-of-britain-s-teenage-girls-115875-21217342/) This statistic that was published by the Sunday Mirror in March of 2009 we can see from this that young women are putting themselves at risk by binge drinking. In Northern Ireland a shocking 44% of young people admitted to having their first alcohol drink aged between 11-13 years with an unbelievable 15% of young people admitting to being just 10 or younger when they had their first alcoholic drink. (Northern Ireland Statistics ; Research Agency) 2008 (http://www.derrycity.gov.uk/care/alcoholcare.html) This statistic proves how many young people in Northern Ireland locally have had an alcoholic drink and this could lead to binge drinking very easily. We can see from this statistic that the percentage of people is increasing throughout the number of age groups. Ireland is listed as having one of the highest levels of binge drinking among the 15-16 year age group. In a recent European School Survey Project on Alcohol and Drugs 1 in 4 young people in Ireland and the UK claim they have been drunk 20 times within the previous 30 days. (Northern Ireland Statistics ; Research Agency) 2008 Within the UK the binge drinking problem is also a major concern with â€Å"More than a third of British adults drink over the safe daily alcohol limit,† (The Guardian newspaper) January 2009 (http://www.derrycity.gov.uk/care/alcoholcare.html) However the amount of adults and young people binge drinking is on the increase governments have had to put forward other ways to tackle this social problem in the form of strategies. Below are three strategies that are put in place in the UK today. * The know your limits campaign – This strategy was launched in 2008 by the Public Health Minister as part of a à ¯Ã‚ ¿Ã‚ ½10 million government campaign to tackle binge drinking. Its aim was to make aware to people the units in drinks so that they may be encouraged to stick to these guidelines. They advertised this campaign through adverts, radio, the press and billboards. It has a budget of à ¯Ã‚ ¿Ã‚ ½6million from 2008 and 2009 to target those at most risk of binge drinking, the 18 to 24 year olds. It provides people with guidelines of how to stick with the recommended daily units of 2-3 units a day for women and 3-4 units a day for men. As well as this it puts out there images of how binge drinking can affect the individual's health particularly through the advert on ‘You wouldn't start a night like this, so why end it that way', in which the girl is shown a pouring drink all over her clothes and vomiting. (www.dh.gove.uk/en/news/recentstories/DH_084904) * The safe sensible Social Strategy – This strategy was launched in 2007 by the Department of Health and Home Office. It set out goals to which they hoped to promote sensible so that harm to the person was reduced. The aims that they set out are: * Minimise health harms * Minimise violence and antisocial behaviour * Ensure people enjoy alcohol safely and responsibly They aimed to encourage a safe environment by focusing on support and information for those who are at most risk. * The Alcohol Harm Reduction Strategy – This strategy was set up for England alone by the government to decrease the harm caused by alcohol and binge drinking. It was not established to cut out drinking alcohol completely but to prevent, minimise and manage the effects of binge drinking. Target group: For this assignment I will be taken a sample of the population in order to carry out a questionnaire so that I am able to get their views and opinions on binge drinking. When deciding on what group I chose to target for binge drinking I took into consideration what age group and sex the health promotion campaign would benefit, will the target group be willing to participate and will they be interested in the research carried out. I have chosen a target group which I will focus my study on and focus the types of questions I will be asking. I have chosen females between the ages of 15 – 18. Rationale for my chosen target group: The reason that I have chosen females between the ages of 15 – 18 was because I could relate to them as they are girls around the same age as me. I also chose this target group as they are easy to access as it relates to year 12 to year 14 within my school. Another reason that I chose to target this age group and this sex was because, when I was looking at the statistics that I gathered both locally and nationally I found out that, over 50% of 15-16 year-olds have participated in binge drinking and almost one in every six female drinkers aged over 16 now drinks more than double the recommended daily amount of three units. Within my area in Derry it has become increasingly popular to drink at a young age and drink is very easily accessible and Fake identification is also on the increase and I would like to be more aware of these issues. So by carrying out this health promotion activity on binge drinking I feel that I can either prevent or delay them to a later age so that they are a lot more sensible and totally aware of the dangers and effects of binge drinking. Resources While carry out this assignment, I have had to gather different forms of research for the chosen topic. I will now discuss the types of secondary research that I have gathered and why these are of importance: * Internet – I have found information regarding statistics for binge drinking rates within the UK and Derry. I have referenced the sites that I have used throughout my assignment. * Newspaper article – An article that was published in March of 2009 in the Sunday Mirror stating that ‘Two in three of the 1,600 under-18s who needed medical treatment after drinking binges last year were girls.' * Television documentary – In one of my lessons in my health and social care class I watched a programme on the effects of binge drinking that the celebrity Michelle Heaton took on in order to show the British Public what they are doing to their health and bodies. It really showed both me and the viewers the reality of the dangers of binge drinking throughout numerous weeks. It definitely portrayed the negative sides of binge drinking. I felt that it highlighted the dangers of binge drinking and the serious risks involved. * Health promotion leaflet regarding alcohol – Alcohol ; Young people has been put together in Northern Ireland. It includes questions and answers on alcohol and there are also useful contact details to contact in order to get advice and guidance. The leaflet was useful as it was easy read and educational for the reader. * A leaflet – I also used another leaflet that I found in my local hospital which clearly set out the dangers of binge drinking on the human body through a diagram. I felt that this was beneficial to me as a reader as it was easily set out. I have used all the above resources which have enabled me to gain a greater understanding of the definition of binge drinking. I felt that this has enabled begin my health promotion campaign with a greater understanding of the term binge drinking. Promoting health and well-being Health and well being can mean different things to different people. Health and well being can be described in different ways like: The achievements and maintenance of physical fitness and mental stability. This is a positive definition of health and well-being. The absence of physical illness and disease and mental distress is a negative definition of health and well-being. The holistic definition of health and well-being is the combination of Physical, Intellectual, Emotional and Social health. I think health and well-being means being able to run a mile because if you can't run a mile you are not healthy. You might not exercise regularly so you are not healthy. I think hardly ever going to the doctor means that you are not healthy because you don't now if you have any diseases and you don't know if you are ill so you have to go to the doctor. I think to be healthy you will need to have a good figure, need to go to the doctors regularly and doing exercise regularly. Physical needs are all about our body working. Everyone's body is unique and we need all our cells to work because we need to do certain things at certain at time like going to the gym regularly. There are certain physical needs every one needs like food, water, shelter, warmth, clothing, rest. If we didn't have theses things our body wouldn't work the way want it to work. Intellectual needs are the things that keep our brain working like education, mental stimulation and employment. If our minds or brain does not work regularly, this will affect our health. A disabled person will have a problem on learning new things. Emotional needs are all about people being loved, respected and secure. Read also Six Dimensions of Health Worksheet People need to feel, recognise and express their different emotions to cope with situation in their life like: when you fall in love and then get married, you find out that your partner is having an affair, you need to be able to get over it. Social needs are those that make us adapt to environment like making new mates. You need these because it will affect your health. This can include you having a relationship with some one. You need to enjoy your self because this can affect your health. http://www. european-quality. co. uk This is a picture of Maslow's hierarchy of needs. It shows things that a person will need in life to survive and it shows what a person that might not need as much as other things The triangle shows important needs at the bottom and complicated needs at the top. The triangle is set like this because it is showing the things we need in life to survive like food, drink and etc. this is shown at the bottom. At the top it is showing what we don't need in life to survive like self-actualisation. This is the complicated need of a person in life. There is a table that is showing life stages from infancy to later adult hood. Infancy aged around 0 to 3 years Child hood aged around 4 to 10 years Adolescence aged around 11 to 18 years Adult hood aged around 19 to 65 years Later adult hood aged around 65+ years People's health will change during life at Infancy and child hood. At this age the child will need help going round. The baby will need help to sleep. It needs protecting and the baby will cry for food. This is a physical need of child. The baby will learn how to play with toys. How to communicate with others. The baby will start listening to music. The parents will need to teach the child to read by reading bedtime story. This is an intellectual need of a child. The baby will need love and care from parents. This is an emotional need of a child. The baby will need to make new friends and will need to go to nursery. This is a social need of a child. At adolescence peoples health change dramatically. This person will start going on to sports like running, gymnastic. The person will become healthier and will have a good diet. Some times the person will have a bad diet so he or she will be not healthy. This is the person's physical need of a person. There hormones will be high! This person will go to school to be educated. He or she will learn new skills. They will learn how to play games like jigsaw, chest. This is the intellectual need of adolescence. Adolescence will start to understand what hormones are and will start to develop it. He or she will star to have relationship with the opposite sex (male or female). This is an emotional need of a child. These teenagers will start making mates. He or she will start to go out with mates. It will star doing activity (hobbies). It might go to clubs. This is a social need of a child. A disabled person's life will change dramatically like he or she might recover the disability. If the person is disabled he or she will need different types of health. This depends on how the he or she is disabled. The disabled might need help like: how to walk, accessibility such as lifts, needs potential help. Some disabled need help every time. He or she might need help to go to the toilet (can't control bladder). This is physical need of a disabled person. The disabled person will need to learn how to use a wheelchair. They might need to be educated. This is an intellectual need of a disabled person. The disabled will need ways to deal with bullies like: people laughing at them. It will need love from parents, sisters, brothers and family. This is an emotional need of a disabled person. A disabled person will need help have difficult making new mates because he different to everyone around him. Many parents don't let their disabled children out because he or she might get lost or might have got into a fight or might have done serious damage to themselves. This is a social need of a disabled person. At adult hood it is a time to take on roles of independence, lifestyles, marriage, and family. During adult hood people health changes because of many reasons like: Physical, this is a time where we are our healthiest and will reach our peak performance. Intellectual, at adult hood, it will be harder to learn new things because our brain is becoming weaker day by day. They can try to learn new things but this time it will be harder. They can learn to play games like: darts. People go to school at adult hood so they can get educated. Emotional, at adult hood people will become more emotional. Their hormones develop. They might fall in love with the opposite sex. They might loose a member of there family. Social, at adult hood people will go out more with mates. They might go clubbing or they might go to a strip club. They will have more confident. They will make friends easily. Some people might find making friends hard. This can be because he or she might be shy. At later adult hood people over the age of 65, health will change very quickly like he or she will retire. This means they are very old. Many older people start doing things they have not done when they were younger and when they were at work. They might go on a vacation. They might start to play some type of sport like golf. Some older adults are not able to be as active in their retirement as others because they are not as healthy as they used to be. They might also loose their partner or a member of his or her family. The standard definition of negative health and well-being is when someone thinks that health isn't injuries, illness or disease. But this is a negative definition of health and well-being. For example, David aged 40, works in a super market. He takes drugs like cocaine, cannabis, and magic mushrooms. He thinks he is healthy because the drugs make him feel good and tough and he hasn't been ill for 15 years. His hasn't been for a check up and hasn't been to the doctor. He doesn't know that he has lung cancer and asthma. Rebecca aged 20, works as a car instructor. She doesn't exercise regularly. She smokes because all her mates smoke. She thinks it is cool smoking so she doesn't go to her local doctor for check ups. She hasn't been there for 7 years. She thinks she is healthy because she is skinny and she is good looking. This two are examples of negative health and well-being. The standard definition of positive health and well-being is the state of complete physical, mental and social well-being and not merely the absence of disease or infirmity. This means if someone is not feeling well he or she goes to the doctor and also has regular check-ups to ensure the body stays healthy. For example: Tom aged 30, works in hospital. He thinks he is healthy because he goes to the gym every day for 3 hours. He likes weight lifting because it makes his muscles bigger. He isn't on medication and goes to doctors regularly for a range of checkups. He doesn't take drugs. Tom has no illness. He also has a healthy diet and goes out often with his friends. Clair aged 15 thinks she is health because she runs a mile every day and goes to the gym regularly. She likes taking gymnastic classes. She goes to a private school called Challenge College. In school she has joined many after school clubs like chess club, basketball and others. She goes to her GP regularly and she doesn't have any dieses. Theses two are examples of positive health and well-being. Here is the 1948 definition of health and well-being: The World Health Organisation takes a more positive view when it describes health as ‘a state of complete physical, mental and social well-being and not merely the absence of dieses of infirmity' (WHO, 1946) Here is the recent definition of health and well-being: The more up to date world health organisation definition of health is â€Å"the extent to which an individual or group is able, on the one hand, to realise aspirations and satisfy needs and, on the other hand, to change or cope with the environment. The later definition of health and well-being is better. This is because the old version does not include the health change day to day but it includes the recent definition of health and well-being. In the 1948 definition of health and well-being it doesn't say anything about life stages changes every day but it mentions about the mental and physical health. The meaning of holistic health is, when a person refers to (P. I. E. S) physical, intellectual, emotional and social. For example everything and everyone around us and affect our health. We need to be prepared for any challenge in life. Here are some examples: Samantha aged 20, works as a train conductor is always looking at all her aspects of her life like: Physical: She always goes to the gym because she likes to be fit and healthy. She is always eating healthily. She goes to doctors for regular checkups. Samantha goes jogging every morning. Intellectual: she is always thinking on how she can improve her life. She goes to college so she can be educated and she is learning how to drive a car. She has started to play games like chess and monopoly. She has started playing for the girl's basket ball team. Emotional: she has broken up with her boyfriend. She hasn't let the broke up upset too much. She is still living with her parent. She looks after her nieces and nephews. Her grandparents have passed away. She doesn't care much about this because she didn't now them at all. Social: Samantha is always thinking of new ways of making new mates. She likes going out with her mates. She likes going to Hollywood bowls. She spends most of her time with her boyfriend called David. Dom aged 60, doesn't work because he has retired and he is disabled. He always looks at his aspects of his life like. Physical: He has to sit in a wheel chair. He rides in his and thinks it is fun. His granddaughter is looking after her. He goes doctors for check ups. He is exercising his upper body because he can't exercise his lower body. Intellectual: Dom has started to take chess clubs lessons. He has started to learn French. He has joined a basketball team. He is learning how to play basketball. He is learning how to play other sports so he can stay fit. Emotional: Dom has lost his wife in a car accident. The death of his wife affecting him for a long time. He has four grand children. He looks after three of them in his spare time. Social: Dom can't do things he dreamt to do along time ago because of his disability. He goes out a lot but can't do everything a normal person can do. He has lots of mates. Lots of his mates come and see him and see how he is doing. In school and at home I asked people what they think health and well-being means to them. I asked Junayed, my parents, my brothers, my friend Tom and my friend Ashlie. Here are the results of my health quiz.

The Secret of Ella and Micha Chapter 2

Ella â€Å"I swear to God if we don't find a bathroom soon, I'm going to piss in my pants.† Lila bounces up and down in the driver's seat. The air conditioner is turned up as high as it will go and â€Å"Shake it Out† by Florence + The Machine plays from the speakers. There's a long road of highway stretched out in front of us, weaving over the hills spotted with trees, sage brush, and the pale pink glow of the sunset. My cell phone is in my pocket, heavy like it weighs a hundred pounds. â€Å"You can always pull over and pee behind a bush.† I prop my bare feet up on the dash and pull my white lacy tank top away from my skin to get air flowing. â€Å"Besides, we're like five minutes away from the off-ramp.† â€Å"I can't hold it for five more minutes.† She shoots me a dirty look and squeezes her legs together. â€Å"You're not going to think it's so funny when the car smells like piss.† I smother a laugh and search the GPS for the nearest restroom. â€Å"There's one right off the exit, but I think it's more of an outhouse.† â€Å"Does it have a toilet?† â€Å"Yes.† â€Å"Then it works.† She makes a sharp swerve, cutting off a silver Honda. The Honda lays on its horn and she turns in her seat to flip him the middle finger. â€Å"What a jerk. Doesn't he understand that I have to pee?† I shake my head. I love Lila to death, but sometimes she can be a little self-centered. It's part of what drew me to her; she was so different from my old friends back in Star Grove. My phone beeps again for the millionth time, letting me know I have a message waiting for me. Finally, I shut it off. Lila turns down the music. â€Å"You've been acting weird ever since we left. Who called you?† I shrug, gazing out at the grassy field. â€Å"No one I want to talk to right now.† Five minutes later, we pull up to the outhouse at the edge of town. It's more like a shack with rusty metal siding and a faded sign. The field behind it is spotted with corroded cars and trucks and in front of it is a lake. â€Å"Oh thank God!† She claps her hands and parks the car. â€Å"I'll be right back.† She jumps out and shuffles inside the bathroom. I climb out of the car and stretch my legs, trying not to look at the lake or the bridge going over it, but my gaze magnetizes toward the level bridge with beams curving overhead and out from the sides. The middle one was where I was standing the night I almost jumped. If I squint one eye and tilt my head, I can spot it. An old Chevy pickup comes flying down the road, kicking up a cloud of dust. As it nears, my nose twitches because I know who it is and he's one of the last people I want to see. The truck stops just outside the perimeter of the field behind the restrooms. A lanky guy, wearing a tight t-shirt, a snug pair of jeans, and cowboy boots comes strutting out. Grantford Davis, town pothead, infamous brawl starter, and the guy who dropped me off at the bridge that God awful night eight months ago. I bang on the bathroom door. â€Å"Come on Lila, hurry up.† Grantford looks my way, but there's no recognition in his eyes, which isn't surprising. I've changed since the last time anyone saw me, shedding my gothic clothes, heavy eyeliner, and tough-girl attitude for a more lighter and pleasant look, so I blend in with the crowd. â€Å"You can't rush nature, Ella,† Lila hisses through the door. â€Å"Now let me pee in peace.† I watch Grantford like a hawk as he rolls a tire across the field toward his pickup. The bathroom door opens and Lila walks out cringing. â€Å"Gross, it was so disgusting in there. I think I might have caught herpes just looking at the toilet.† She shivers, wiping her hands on the side of her dress. â€Å"And there were no paper towels.† Grantford has disappeared, although his truck is still there. I grab Lila's arm and tug her toward the car. â€Å"We need to go.† Lila elevates her eyebrows questioningly as she tries to keep up with me. â€Å"What's wrong with you?† â€Å"Nothing,† I say. â€Å"There was just this guy over in the field that I really don't want to talk to.† â€Å"Is he an old boyfriend?† â€Å"No, not even close†¦.† I trail off as Grantford rounds the bathroom. There's sweat on his forehead and grass stains on his jeans. â€Å"I need to talk to you for a minute.† â€Å"Why?† I question, swinging the car door open. Please don't bring up that night. Please. Lila freezes as she's opening the door and her gaze darts to me. â€Å"Ella, what's going on?† Grantford tucks his hands into his pockets, staring at the hood of the car. â€Å"This ain't your car, is it?† â€Å"No, we just stole it and took it for a joy ride.† Shit. Ten minutes back and my old attitude is slipping out. â€Å"I mean, yes it is – her car anyway.† I nod my head at Lila. â€Å"Well, I was just wondering how fast it goes?† He gives me a fox smile that makes me want to gag. I was never a fan of Grantford. He always had a sleazebag attitude, which was part of the reason why I had him drive me to the bridge that night – he was the only one I knew who would leave me there alone. I can't help myself. â€Å"Probably a lot faster than your pick up over there.† He has a shit-eating grin on his face. â€Å"Is that a challenge?† I shake my head and motion for Lila to get in the car â€Å"Nope, that wasn't a challenge. Just a mere observation.† Recollection fills his eyes. â€Å"Wait a minute. Do I know you?† Ignoring him, I start to shut the door, but he catches it. â€Å"Holy crap! I do know you. You're Ella Daniels.† His eyes mosey up my legs, cutoff jeans, lacy white tank top, and land on my eyes lined with frosty pink eyeliner. â€Å"You look†¦ different.† â€Å"College will do that to you.† I scale up his scuffed cowboy boots, his torn jeans, and stained shirt. â€Å"You haven't changed a bit.† â€Å"I see your mouth hasn't changed at all,† he snaps. â€Å"And besides, you didn't change for the better. In fact, you look like you could be friends with Stacy Harris.† â€Å"Don't exaggerate the situation,† I say. Stacy Harris was a popular girl in our grade; head cheerleader, homecoming queen, wore a lot of pink. His face scrunches. â€Å"You didn't just change on the outside either. If anybody would have compared you to Stacy Harris, you'd have punched them in the face.† â€Å"Violence solves nothing.† I begin to shut the door again. â€Å"I have to go.† He complements my move and seizes the door, prying it back open. â€Å"You ain't going anywhere until I get something out of you.† â€Å"Like a kick to the balls,† I threaten, but my insides churn. I can talk tough, but when it all comes down to it he's a really big guy who could easily hurt me. His grey eyes turn black as the sun sets behind the shallow hills. â€Å"I heard you bailed. Packed up your stuff one night and took off. Pissed off a lot of people, too. The ones that were always protecting you when that mouth of yours got you into trouble. Especially that one guy you were always with.† â€Å"Don't pretend like you don't know his name.† My voice is slightly uneven. I feel out-of-control of the situation and I'm starting to panic. â€Å"You don't forget the names of the people whose fist have slammed into your face.† A vein bulges in his thick neck as he punches the window. â€Å"That night I was wasted and Micha was completely sober. And it was total bull shit that he sucker punched me for leaving you on the bridge. I mean, you asked me to take you there. How the hell was it my fault?† Apparently, Micha hit him more than once because it's not the instance I'm referring to. I tug at the door handle. â€Å"I'm going to close the door now and you're going to walk away.† â€Å"Who are you?† His eyes are all over me. â€Å"I'm who I always was,† I mutter. â€Å"Just without all the baggage.† Calmly, I close the door. â€Å"You can drive away now, Lila.† She floors the car backwards and skids it onto the asphalt. I don't look back at Grantford or the bridge. I breathe through my nose, trying to stay composed and in possession of my feelings. â€Å"What was that about?† Lila asks. â€Å"Who was that creep?† I buckle my seatbelt and turn up the air conditioning. â€Å"Just some guy I used to know from high school.† â€Å"I thought he was going to kill you or something†¦ Maybe we should call the police.† Flashbacks of my old life resurface. â€Å"That's just how things are around here. Besides, he was all bark and no bite. Trust me. He was just irritated with something I did.† Her eyes enlarge and she grips the steering wheel. â€Å"What did you do?† I glance in the rearview mirror at the desolate road behind us. â€Å"Nothing I want to talk about.† She slows down as the speed limit decreases. â€Å"How did you do that? You were so calm even when he tried to hold the door open. I was freaking out.† â€Å"It was just instincts,† I lie. If she knew the real reason we sure as hell wouldn't be friends. *** The urge to make Lila flip a U-turn and floor it back to Vegas becomes more powerful the closer we get to my home. Lila relaxes about the Grantford ordeal when the outhouse is far behind us. We make the rest of the short drive talking about classes and frat parties, but when we pull into the driveway of my house, her fear and panic reemerges. â€Å"This is†¦ nice.† She shudders as she peers through the windshield. â€Å"So this is where you grew up?† The full moon shines in the starry sky, lighting up the trash piled in the driveway, the old cutlass balanced on cinderblocks in front of the garage, and the peeling paint off my two-story home trimmed with a broken rain gutter that's swaying in the wind. The tree beside my window looks like it's dying. It was once my gateway for sneaking out of my room, but the last time I snuck out was the night my mother died. I'll never climb that damn tree again. â€Å"Yep, this is home.† I step out into the cool breeze. Rise Against â€Å"Like an Angel† blasts from the speakers next door. The lights are on in the house, and there's a lot of screaming and yelling going on. The driveway is lined bumper to bumper with cars and people are smoking on the dry front lawn and on the deck. One of Micha's parties. It's like time has frozen and was waiting for me to return. â€Å"God things never change around here.† I round the back of the car. â€Å"Lila, can you pop the trunk, please.† The trunk pops open and Lila steps tentatively out of the car. Her eyes fasten on the party and she's chewing on her thumbnail, which is a nervous habit of hers. â€Å"Jeez, it's more intense than even a frat party. I didn't know that could be possible.† I sling a heavy bag over my shoulder. â€Å"Are you sure you want to sleep at my house tonight?† I rummage through the trunk for the bag holding all my toiletries. â€Å"There are some pretty decent hotels in the next town over.† â€Å"I'm just not used to this kind of a place. That's all†¦ But I'm sure it's fine.† She collects one of my pillows from the trunk and hugs it tightly. â€Å"Are you absolutely sure?† I balance a small box under my arm. I don't want her to stay and witness this side of my life. â€Å"This place is a lot to take in for some people.† She narrows her eyes and points a finger at me. â€Å"I may come from an upper class town, but that doesn't mean I haven't been in rougher areas before. Besides, we went to that pawn store that one time in Vegas and that neighborhood was definitely sketchy.† It really wasn't that bad of an area, but I decide to let it go, since she'll only be staying here for one night. â€Å"Sorry, I just†¦ I want to make sure you're comfortable.† I shift the bag onto my hip and feel around the dark trunk for my other bag. â€Å"I promise I can manage for one night.† She crosses her heart with her finger and smiles. â€Å"In fact, I might even get brave enough to go check out the party next door.† I rapidly switch the subject. â€Å"We can probably get the rest of this stuff out tomorrow, since it's dark and I can barely see. And I don't know about you, but I'm exhausted.† â€Å"I think†¦Ã¢â‚¬  Her eyes wander in the direction of the driveway. â€Å"Dear God Almighty, who is he? Wait a minute. Isn't he†¦ yeah†¦Ã¢â‚¬  She lets out a quiet squeal and hops up and down. â€Å"Ella, I think it's the guy from your drawing, that Micha guy you insist you never dated.† My bag falls to the ground as I slouch down, debating an escape. Duck under the car? Run into the house? Dive into the trunk? â€Å"Hey there, beautiful,† Micha says in his flirty tone. â€Å"You shouldn't park your car out here in the open. Someone will probably jack it.† The sound of his voice sends a tremble through my body that coils down deep inside me. I thought the feeling would be gone after being away for eight months, but somehow time has had the opposite effect – it's amplified and taking over my body. I pretend to be engrossed by a box in the trunk and put my head amidst the shadows. Lila giggles. â€Å"I'm sure my car will be okay. This is my friend's house.† â€Å"Your friend's house†¦Ã¢â‚¬  He drifts off, making the connection and anxiety strangles me. â€Å"Wait a minute? Are you talking about Ella Daniels?† Collecting myself, I slam the trunk down. When he sees me, his eyes enlarge and he has the same expression on his face as when his mama told him his daddy wasn't ever coming back. He blinks the stunned expression away and a hint of anger transpires. â€Å"What are you doing here? I thought you were in Vegas.† For a moment, I'm unable to speak, caught in a mixture of emotions from seeing him again. Micha has always been stunningly beautiful in a way that makes artists' hands ache. He's dressed in a red plaid shirt, dark jeans, and a pair of black boots. His lips are full and ornamented with a silver loop and his dirty blonde hair has a slight wave to it. His skin is like porcelain and his aqua eyes carry more than I can handle. â€Å"I was down there for school, but I'm back now,† I say in the polite tone I've used with everyone over the last eight months. But on the inside my heart is wild, and my blood is roaring with the same yearning I felt for him when I left. â€Å"Wait a minute. You knew I was down there?† He sidesteps around Lila and positions himself directly in front of me. Micha is one of the few guys that is taller than me and I have to angle my head up to meet his eyes. â€Å"I had no idea where you were until this morning,† he says. â€Å"Since you didn't tell anyone where you went.† The ache in his voice stabs at my heart and the phone carrying the voicemail in my pocket weighs a thousand pounds. â€Å"Sorry, but I needed a break from this place. It was†¦ things were†¦ well you know how it was.† â€Å"No, I don't know how it was.† He braces a hand on the trunk like he's going to fall over. â€Å"Since you took off and never told me where the hell you went.† I need to go before he gets to me, and all my self-control evaporates. Picking up my bag from the ground, I wave good-bye to him. â€Å"It was nice talking to you again, but we've been on the road for like twelve hours and all I want to do is lay down.† â€Å"I'm not really that tired,† Lila says and I press her with a pleading look. â€Å"Oh, wait maybe I am.† She fakes a yawn. I hurry for the side door of my house, but Micha blocks my path, and his hand comes down on the car like a railroad track barricade. He drags his lip ring into his mouth with a passionate look on his face, like he might kiss me or something. For a second, I wish he would. He leans toward my ear, lowering his voice to an intimate level. â€Å"Come with me somewhere. Please. I've been waiting eight months to talk to you.† I flinch at my body's fiery reaction his voice emits. â€Å"I can't talk to you, Micha.† I choke, backing away, and bumping my hip on the edge of the car. Tears threaten the corners of my eyes, but I haven't cried in over a year and I refuse to break down. Spinning on my heels, I dash for the house. He doesn't call out to me – it's not his style. But his gaze bores a hole into my messed up head the entire way, until I'm finally locked inside my house. Then I can breathe again. Micha I swear I'm dreaming. Ella is standing in front of me and she looks just like Stacy Harris, a slutty cheerleader we used to go to high school with and who Ella beat up once because Stacy was making fun of a girl in a wheelchair. It was one of the things that made me fall in love with her; the fire, passion, and the need to stick up for the outcasts, even if it meant being an outcast herself. She never fell into any category – she was just Ella – but now she looks like a freakin' Stepford Wife. She's still hot as hell, a rock hard body, and long legs that go on forever. I've pictured those legs wrapped around my waist many times and the same images flood my head, even though she looks like a stranger. Her gorgeous green eyes are glossed over, like she's repressed everything inside. She's unhappy to see me and it hurts a little, but pisses me off more. She starts rambling about being tired, something she used to do all the time to avoid confrontation. I watch her lips move, wanting to kiss her so God damn bad, but knowing she'd probably kick me if I tried anything. So I lean in, smelling her hair and beg her to come with me somewhere. Then she runs down the driveway and locks herself in the house. I start to chase after her, but a Frisbee smacks me in the side of the head. â€Å"Sorry man,† Ethan calls out, hopping over the fence with a smirk on his face. â€Å"It slipped.† Rubbing my head, I arch my eyebrows at Ethan. â€Å"Perfect timing asshole.† He holds up his hands. â€Å"I said I was sorry. You were just standing there all dazed out like a freaking whipped pussy, so I thought I'd snap you out of it.† He scoops up the Frisbee from the concrete and gives a low whistle at Ella's friend's Mercedes as he circles it rolling up his sleeves. â€Å"Whose sweet ride is this? Wait, is it Ella's?† â€Å"I think it's her friends.† I eye the back door of her house, debating whether I should barge in after her and demand to know why she shut me out for eight months. â€Å"Since when does Ella hang out with people who drive cars like this?† he asks, peeking through the tinted windows. â€Å"She's been gone for eight months.† I back toward the fence that separates Ella's yard from mine with my hands in my pockets. â€Å"Who the hell knows who she is anymore?† I need a drink, even though I haven't had a drop of alcohol in eight months. The day Ella took off, with no note or a good-bye, I had gone up to the cove, got drunk, and took all my anger out on Grantford Davis' face. The cops showed up and I got busted for being under the influence and for assault. I'm still on probation for it and I had to go to anger management classes for a while. I've been really good about keeping my crap together, but five minutes after Ella shows up and I'm about to throw it away. I head to the kitchen, scoop up a beer from the ice chest, and settle on the couch between a blonde and a brunette. The blonde one giggles. â€Å"Oh my God, is the bad boy Micha finally back?† I can't remember her name, but I play along. â€Å"I sure am, baby.† Then I swig my beer back and bury my pain, along with Ella. She's the only girl that's ever been able to get me this upset. The only girl that's never wanted me.

Should gay marriage be legal Essay Example | Topics and Well Written Essays - 250 words

Should gay marriage be legal - Essay Example One thing, which needs to be considered is that the number of gays living in the United States is very less as compared to the people who like to have relationship with the opposite gender. Therefore, giving freedom to such people to develop relationships with the same gender does not make a big difference. From the perspective of gays, some of the reasons that support gay marriages include strengthening of social concept of marriage, sexual freedom, and freedom of choice. Gay marriage has least concern with the morality since it promotes justice, freedom, and equality. If a person wants to spend his life with a person belonging to the same gender, no one should oppose it because every person has the right to do whatever he wants to do as long as his actions do not affect the rights of any other person. Therefore, gay marriages should be held legal because it does not affect the rights of others. Warren, Patrick. â€Å"Same Sex Couples Can Avoid Unnecessary Problems By Getting These Documents In Order Now.† Ezinearticles.com, 03 Aug. 2011. Web. 23 Sep. 2011.

Multinational Culture and Development of a Dominant Market Player Essay

Multinational Culture and Development of a Dominant Market Player - Essay Example Rather, the process is much more akin to a learning curve through which each and every organization/firm/company must contend. Due to this non-uniformity, each and every firm experiences different levels of success with their attempts to make the difficult transition from that of a successful firm to that of a fledgling multinational. However, it can be argued that if there were such a thing as a single determinant that expressly assured a degree of multinational success it would be those companies that retain a healthy and vibrant culture that pervades every sector of their company and product/service offerings (Lashinsky 2005, p. 80). Such a statement will, of course, be corroborated by this analysis; however, even cursory examinations of a litany of multinational corporations that have succeeded share this common denominator towards eventual success. Moreover, the degree to which Sony focuses its energies on innovation and product development/change will also be discussed. Finally , a thorough examination of the ways in which company culture serve as a type of feedback loop into the items that have previously been listed, compounding, reinforcing, and encouraging the firm to even higher exemplifications of business success will be discussed and analyzed.

The changes in media and uses of media in their lifetime and the Essay

The changes in media and uses of media in their lifetime and the effects on their personal, social and work lives - Essay Example Technology has and still is evolving so fast that it has left people utterly spellbound by the comfort added to a common man’s life. Personally, advancements in technology have helped me live my life extremely conveniently than I was living prior to the invention of television, cameras, and computers/laptops, etc. AB: What was the first technology that you used? Was that a common product in that time? AK: The first technology that I remember using with most enthusiasm was a wireless radio which was particularly special in the sense that it operated on FM programming which made it better than other radios most other people owned around me which used the AM method. FM radio technology was developed as an alternative to AM because it could transmit signals on any frequency. At the time I got one FM radio for myself in 1961, this technology was newly introduced and very few people owned it so it was not quite a common product in that time. But yes, FM radio technology became rapid ly popular during the 1960s and very soon it began to be recognized as public’s choicest medium for listening to rock music or classical plays. AB: Can you describe the first impression of your first touch with that technology? AK: Because the wireless FM radio technology I just mentioned was new at the time I bought it and not many people around me had one of the kind then, so naturally I felt extremely lucky, blessed, and enthralled because it was such an exceptionally modern and convenient medium of listening to music, dramas, and educational programs. At the time I first came across this prized technology, it was the fastest medium for communicating news of the day and the first choice of people like me who were unfortunate enough to get a television. However, only a handful people of my age possessed the kind of radio I had for myself in 1961 which made me quite distinguished among my friends and the memories of how we friends used to get together to listen to the classi cal music broadcasted on the radio are just priceless. AB: How did the media change? For better or worse? AK: Not long after commercial television stations were made available in the market during late 1940s, radio technology took hold of the people throughout the 1960s and onwards. While the technology continued to attract gifted inventors from all over the world, one after another riveting change in media got introduced at more affordable prices which revolutionized people’s lives for the better. Also, there were huge payoffs like myriad technology advancements brought people closer by turning the world into a global village and bridging distances. Many tasks which otherwise consumed many hours began to be completed in a matter of minutes and one can access the entire world through the internet while sitting at one place. AB: How did you communicate with your family or relatives in overseas in the past? How about now? AK: There is no comparison between the way I and other p eople of my generation used to communicate with family and relatives living abroad in the past and in the present. In the past, the means of communication with family and friends were extremely slow, time-consuming, taxing, and literally wore people out. In contrast, communication media now are unbelievably fast, liberating, rewarding, and facile. Now people do not have to wait for months for the letters written by them to reach their dear ones thanks to

Political Economy of Oil Essay Example | Topics and Well Written Essays - 2500 words

Political Economy of Oil - Essay Example The crises that started with the oil crisis in 1970s extended to Gulf War in the 90s. There are different terrorist threats today that affect oil resources such as oil refineries in Saudi Arabia. The deteriorating law and order situation in Iraq also resulted in fear of disruption of oil supply. There are threats of war with Iran that bring greater fears of volatility in the oil-producing region. These & other such factors have kept oil prices very high and they affect current market scenario. The hope for stability in oil prices is dependent on both political & economic stability. Transportation, heating, power generation, the plastics, pharmaceuticals and synthetic fibre industries are the main ways in which oil is consumed. Demand for oil is greater in the developed nations compared to the developing economies. United States of America solely generates a quarter of world oil demand. Asia comes next with Japan having the highest consumption of oil. In Europe no one country can be considered highest oil consuming country instead the demand is evenly generated by all European nations, The demand for oil diminished considerably in Soviet Union after its collapse.US demand for energy is greater and its dependence on oil producing countries is also increasing. The oil supply is mainly provided by large companies operating in countries with large reserves of oil. Countries like UAE, Saudi Arabia, Venezuela, Norway and Kuwait are some of the oil rich countries and are main suppliers of oil to the world. Since supply side of equation plays a crucial role in stabilty of oil markets, the countries producing oil have been trying to stabilize the price of crude oil through production policy. However, the interest of world economy does not lie in bringing stability by production manipulation. Since oil is a resource that depletes with time so its value increases with time as well. A country cannot let go of its future worth or value by increasing its production at the current market price. It is not in the economic interests of such oil producing countries to pursue a production policy incompatible with their own economic interests. Countries like Saudi Arabia have been contributing to the world economy in general and other Western and developed economies like Japan in particular by supplying more oil than it should. For instance Saudi Arabia, of the largest oil producers, increased its production of oil after the oil crises of 1979, resulting in a downward crude-oil price trend in world markets. This manipulation by any country or cartel cannot reap economic benefits in the long run. The market factors should be allowed to play their due role instead of manipulation. There is an increasing trend in demand for crude oil because consumption is greater than the supply. Market economy is the best way to allocate resources. The concept of oil peak suggests that once we reach the stage of peak the economy will be greatly affected. Similarly experts say that world oil reserves will also reach its peak in not so distant future resulting in price hikes and economic recession along with geopolitical repercussions. Oil Situation in USA If we consider the oil peak theory according to which there will be a sharp decline in supply because demand is constantly increasing whereas the speed of finding or exploring new oil sources is not matching that then we come to know that the oil

Research paper on three plays Essay Example | Topics and Well Written Essays - 1000 words

Research paper on three plays - Essay Example an, narrates the story of a tragic character so engrossed in his false belief, that reality and illusion merge, resulting in an internal struggle that leads to his downfall. Each play portrays the internal battle of a man struggling to come to terms with his own, bitter reality and departing from his fantasy world. In selecting the frailty of illusion over the constancy of reality, the protagonists meet their inevitable disaster. From the start of Sophocles’ tragic play, Oedipus takes many actions and makes many choices leading to his own downfall. Oedipus selects to disregard numerous warnings, involving truth of his life and family background. Teiresias supplies Oedipus with everything he has to know regarding his fate by stating, â€Å"You, yourself, are the pollution of this country,† (634). Notwithstanding this evident assertion of truth, Oedipus chooses to delude in his comfortable fantasy, that he has escaped his inevitable fate. He chooses to ignore the prophecy of his fate to kill his father and marry his mother. Oedipus tries to resist the gods by escaping from his homeland, Corinth, but instead throws himself directly into the hands of fate. Oedipus ignores another warning of truth in ignoring the words of Teiresias. He thinks that he has successfully evaded his own destiny; however, he could not have been farther from the truth. Oedipus’ imprudent decisions finally lead to hi s ruin in the play. Oedipus’ most irrational choice succeeds throughout the play: the choice of illusion over reality in the end costs him his life. Similar to the Oedipus’ inability to accept the truth, Hamlet persists in blinding himself. Even after the ghost narrates to Hamlet how his father was killed, Hamlet has the players act it out, in order to be convinced. His obscurity of the truth remains consistent. Although the king gives himself away after seeing the replay of his brother’s murder, by yelling, â€Å"Give me some light. Away!† (79), Hamlet is still undecided.

Analysis of Images of Organization by Gareth Morgan Essay - 1

Analysis of Images of Organization by Gareth Morgan - Essay Example I) He explains that ‘Metaphor is inherently paradoxical in nature and has far-reaching consequences. One major problem that faces modern management today is our mechanical way of thinking about organizations, that is so deeply rooted in us, that we find it find it very difficult to organize things in any other way. In Chapter 2, (Morgan, 2006, pg. 11) enlightens us on how labor became revolutionized and how machines took command in the workplace. In ancient times work was carried out in a very laborious way, making use of only manual labor. As time passed and people became more civilized they began making tools to assist them in their work. Nowadays, Mechanization has taken over every area of work making it much more easy for us than it was in ancient times. Productivity has increased a thousand fold because of the great transition from being a craft to factory production. (Morgan, 2006, pg. 11) However, in the course of this revolutionization in work culture, we have to bear the assault made on the human spirit. We have adapted ourselves to the machine age and have come to use machines as a metaphor for ourselves and the society at large because we have to mold ourselves according to mechanical principles that have become part and parcel of our lives. Gareth Morgan, in chapter 3 of Organization as Flux and Transformation explains the importance of an ‘Open System’ that involves a continuous cycle of transformation, input, output and constructive feedback. In order to achieve such a harmonious working atmosphere, it is imperative to maintain healthy relationships between the environment and the internal functioning of the organization. Referring to Humberto Maturana and Francisco Varela, Morgan argues that their opinions on the ‘Open system’ differ as they feel that ‘all living systems are organizationally closed, autonomous systems of interaction that make reference only to themselves.†

Ethics Goes To Hollywood Essay Example for Free

Ethics Goes To Hollywood Essay When we think of ethics with regards to Hollywood, some people might even question if there really are any left? With the growing number of moralists and critics that easily target Hollywood, ethics has become an important factor that seems to be set aside. Many of the movies that are being shown today presents violence, nudity and lack of values incorporated with the film. But there can always be an argument about how is ethics really perceived through the movie industry? Some might doubt but actually when we look pass through over-all violence and those unacceptable factors to moralists, some movies do posses ethics in them. Most of the time, those ethics are just overlooked by the over-all presence of the movie. When we analyze and breakdown a movie and study the characters there is a great opportunity to realize the moral fiber of the film. In recent memory, there are only a few movies that have produced an unusual style of presentation in the silver screen. One of those movies showed up during 2007 through a film titled â€Å"300†. It was based from Frank Millers graphic novel also named â€Å"300†. This movie adaptation of the novel is also based from the Battle of Thermopylae that was retold in a fictional sense. To further analyze the movie, the following paragraph will showcase the movies summary. Beginning with the presentation on a how a Spartan boy grows up and how he emerges to be king of Sparta, the movie was narrated by Dilios, a spartan soldier who was able to live and tell the tale. After years of being Spartas king, Leonidas received a messenger who was sent by the Persian ruler Xerxes. The messenger presented an offer that enraged king Leonidas, leading the messenger kicked down a seemingly bottomless pit. The message was sent clear, the Persian army is about to come, to invade Sparta and add it up to their growing territory. King Leonidas then consulted the Ephors, priests who consult the oracle for answers from the gods. Proposing a plan to block the Persian army by defending the Hot Gates of Thermopylae, King Leonidas was furious by the Ephors advice of not to fight because the oracle said that it was forbidden and the gods will get enraged if they do. Despite all of this, Leonidas stood strong with his firm decision to defend the Hot Gates. He gathered 300 of the greatest Spartan soldiers and assembled a party that would hold off thousands of Persians. As they have reached the Hot Gates, they defended it for days just to protect Sparta. King Leonidas courageously led the way by standing strong to his principles until the end. The number of the Persian army was too much for the 300 Spartans and eventually led to their deaths. Only one soldier was tasked to return to Sparta to tell the tale, Dilios, who forever made Leonidas and the 300 Spartans, remembered. LEONIDAS AND HIS VIRTUES The whole essence of the story evolved in Leonidas answer to his ethical dilemma that concerned with his decision to push through despite a number of people prohibiting him. One example was when he was discouraged by the Ephors or priests to pursue his plan because it was the time of the Carneian festival. His ethical dilemma would be is that if he pushes through with his plan, he would be disrespecting the Carneian but he would be able to salvage some time to defend Sparta. Despite the senates disapproval of sending the whole Spartan army, Leonidas faced his dilemma by standing strong with his beliefs and forming an army of 300 to continue his plan. Another example would be seen during the scene where the Persians were negotiating with Leonidas. First was during the arrival of the Persian messenger who offered Leonidas salvation of the Spartans from the Persian army if he yields. Another was during their stay at the Hot Gates, when King Xerxes himself talked to Leonidas personally and again proposed to have them spared if he yields to the Persians. Both of these instances presented a same result, Leonidas refusing to give up and standing strong to his principles. Choosing the side of whats right than whats wrong, suggests Leonidas firm ethical correctness and proper morality virtues. OTHER ETHICAL THEORIES PRESENTED Egoism is also depicted in the movie as seen in Xerxes motivation to rule and conquer the world. His actions towards self-interests boost his drive to invade and gain territories. In one instance, he even called himself the king and ruler of the world. A little bit of Egoism can also be attributed to Leonidas. His strong desire to win and his confidence to bring only 300 soldiers despite knowing that his enemy would be thousands in number suggests a showing of Egoism. CONCLUSION When we analyze the definition of ethics we easily incorporate it with whats write and whats wrong. Most of it solely depends on how we make that decision. The movie â€Å"300† despite its over-all violent nature still possessed that essential factor of morality and the integration of ethics through the characters, most especially Leonidas. Being the Spartan king, his decision to protect his kingdom by defending the Hot Gates despite disagreements by the senate and the priests caused his ethical dilemma. By overcoming this dilemma and choosing what he knows is right, it created a chain of events that lead to his popularity and immortality through the help of the story thats still known up to today. Despite Xerxes tempting offers in order for him to surrender, Leonidas strong principles carried him all the way to legendary proportions. Driven by a kings instincts, Leonidas died for the people of Sparta which caused them to be more inspired and more driven to defeat the Persian army that arrived pass the Hot Gates. All in all, despite Hollywoods descending reputation in accordance with moralists, people can still find ethics in movies. People just need to look pass through and analyze the details to get the even bigger picture. References Mackie, J L. (1977). Ethics: Inventing Right and Wrong. New York: Penguin Books. Simpson, R. H. (1972). Leonidas Decision. Phoenix (Vol 26, pp. 1-11).

Structure and Chemical Composition of Silk

Structure and Chemical Composition of Silk Silk: A Natural Polymer By: David Church â€Å"The Silk Road,† a trading route that can be traced back to over 3600 years ago, but still is a household recognized name. Standing the test of time proves that this product was extremely important in shaping history. According to Chinese historians, silk began with the prince of China, Hoang-ti, and his wife, Si-ling-chi. The prince wanted his wife to contribute something important to their people. He assigned her the task of finding a use for the thread that came from silk worms. Si-ling-chi was able to develop a method to feed the worms, extract and reel the thread, as well as create clothing from the silk. The Chinese were able to keep not only the method of producing silk but also the source (the silk worm) a secret until about the sixth century. The nobility of the world was forced to pay as much as its weight in gold for silk until about 555 A.D. This is when two Nestorian monks were able to bring a few silk worm eggs to Constantinople, which began the spread of pr oduction through Europe and other parts of Asia.6 Silk can come from many different insects, including caterpillars, spiders, and worms. The most economically viable silk is produced from mulberry silkworms because they can be raised in captivity and their silk can be mass produced. The larva is born from an egg and must be fed mulberry leaves for up to one month before it is ready to create a cocoon of silk. Once it creates this cocoon, workers kill the larva inside using hot water or steam, and then proceed with the rest of the manufacturing process.5 The structure of this silk is composed of amino acids linked together in a long chain. Three main amino acids comprise 83.4% of the total polymer structure with trace amounts of many other amino acids. A total of up to 2592 different amino acids can be found in a polymer chain of silk. The three frequent amino acids include glycine, alanine, and tyrosine, with ratios in the polymer chain of about 1/2, 1/4, and 1/16 respectively. This leaves a ratio of about 3/16 of all other trace amino acids. If we denote glycine as G, alanine as A, tyrosine as T, and all the other amino acids as X, an outline structure of the polymer can be created to follow a pattern similar to: [G-A-G-T-G-A-G-X-G-A-G-X-G-A-G-X] n.2 Even though the chemical structure of this polymer chain seems like it could be very complex, the actual structure of the chain is relatively simple. The two most frequent amino acids present (glycine and alanine) in the polymer make up about 75% of the polymer chain and fortunately have two of the simplest individual structures of all amino acids. Glycine’s and alanine’s chemical structures are shown in Figures 1 and 2 respectively.2 Figure 1: Glycine Chemical Structure Figure 2: Alanine Chemical Structure The third most frequent amino acid present, tyrosine, is a little larger and more complex because it contains a benzene ring. Its chemical structure is shown in Figure 3.2 Figure 3: Tyrosine Chemical Structure The similarities in the chemical structure of these amino acids should be noted. As a generalization, all amino acids can be represented with an amino group, a hydrogen atom, a carboxylic acid group, and a side â€Å"R† group all attached to the alpha carbon as shown in Figure 4.2 Figure 4: Generalized Amino Acid Chemical Structure The method of synthesis that is used is step growth condensation polymerization. To perform this reaction, a hydrogen atom from the amino group of one amino acid reacts with the hydroxide molecule from the carboxylic acid group of another amino acid to form water. This allows for the nitrogen atom to bond directly to the carbon atom and start a chain. One step in the polymerization process between glycine and alanine is shown in Figure 5.1 Figure 5: Polymerization Step This process propagates in a chain of amino acids with the pattern previously shown in Figure 1. Denoting â€Å"R† for the side chain in tyrosine and â€Å"R1† for all the side chains in the numerous trace amino acids, a simplified polymer chain diagram would look something like what is shown in Figure 6.1 Figure 6: Simplified Polymer Chain2 As the name suggests, â€Å"The Silk Road† was a route taken in order to trade silk between communities, however, silk was not the only product being transported on this route. Silk is arguably known as the most significant product being transported at the time, but because of the existence of the Silk Road, it made it much easier to trade other commodities, such as gold, precious metals and stones, ivory, exotic animals, and religion. The route provided a means for Buddhist missions to travel from India to influence China. The starting point of the Silk Road and capital of China was Changan. During the heyday of the Silk Road, about 740 A.D., Changan grew into one of the largest cities of the time with a population of about two million people. As the Silk Road developed and the precious items became more widely known, it in turn became more dangerous to travel. Bandits took advantage of the long, desert road by attacking and looting caravans. To combat this, sections of the G reat Wall of China were constructed to defend the caravans.9 The simple pleasures that silk provided like comfort and social hierarchy caused a chain reaction that in turn led to the globalization of trade, religion, economy, and mass construction. Today, silk has taken on a new importance to society with the many technologically advanced uses that will be discussed later. Both the advantages and disadvantages of silk can mainly be contributed to the inherent biological nature of its formation. The advantages of silk come from comparing it with other natural threads and with artificially created threads. The mulberry silk worm produces large amounts of silk in a convenient cocoon shape that is easily industrialized unlike other natural threads. The natural process of protein organization with such chemical control has not been able to be replicated artificially in a laboratory. The first disadvantages of silk are bound by the limitations of nature. The only insect that is currently capable of mass producing silk is the mulberry silkworm. Other insects that produce silk such as spiders are carnivorous and independent in nature, and cannot produce mass quantities silk. Therefore, creating a farm of spiders that can produce enough silk becomes very difficult. The mulberry silkworm only creates one type of thread whereas a spider can produce typically five types of thread that have different and desired properties.4 A few other disadvantages include photo-yellowing, wrinkling recovery, and rub-resistance. Photo-yellowing is a phenomenon where the silk turns a yellowish tint after prolonged exposure to light. Silk cloth has poor wrinkling recovery meaning after it is creased; it is difficult to get it smooth again. The rub-resistance or abrasion-resistance of silk cloth is also poor, which is the ability to resist surface wear from flat rubbing on another material.5 The obvious example of a use for silk is cloth which also takes up the greatest portion of silk consumption. There are many other uses of silk specifically in the medical field that have arisen recently due to advances in technology. The fibers of silk have been used for sutures of wounds, because it does not trigger a response from the human immune system. For the same reason, it has been used as replacement ligaments, tendons, bones, and cartilage.3 After further research and development, a potential use is an artificial cornea made from a silk film that is lasered to become permeable. Another potential use currently under research is very thin, degradable silk films with electrode arrays printed on them. These films could form to the contours of the brain and potentially treat epilepsy and other conditions with less scarring than traditional procedures. New innovative uses for silk are surfacing and being researched regularly.4 Silk is a rapidly renewable resource that is both reusable and biodegradable. It has much less negative impact when compared to other fabrics if it is produced safely and organically. There is not much processing involved in the creation of silk that normally would cause unnecessary environmental impact. The mulberry plantations provide prevention to soil erosion from wind and water, as well as improving air quality by naturally filtering the air. Some silk has been advertised as being a â€Å"green† product when produced with the appropriate caution, but it also has negative environmental impacts associated with its production. 7 In non-organic production, pesticides and fertilizers are used in the growth of the mulberry trees that pollute the air when sprayed and the ground water when washed away by precipitation. Chemicals are used in the â€Å"degumming† process that are eventually wash off creating wastewater that in certain cases may or may not be reclaimed at a w ater treatment plant. In most areas silk is produced where populations are large and land is sparse, such as China, Japan, Italy, and India. The mulberry plantations take up a significant amount of land. 8 These are some of the few locations that have been able to successfully grow mulberry plantations; subsequently a great deal of transportation is required to deliver the silk to its consumers leading to pollution. As with any industrialized production, there are always environmental impacts both positive and negative that arise.7 References Ahluwalia, V.K., and Anuradha Mishra. Polymer Science. New Delhi: Ane Books Pvt. Ltd., 2008. Print. Bergmann, Max, and Carl Niemann. On the Strucure of Silk Fibroin. Journal of Biological  Chemistry 122.2 (1938): 577-596. The Journal of Biological Chemistry. Web. 25 Sept.  2014. Boado, Christine. Hand Designed Silk Embroidery Art with Over 2,500 Years of History.  Importance of Silk. Art of Silk, 12 Sept. 2012. Web. 25 Sept. 2014.  http://www.artofsilk.com/blogs/news/6565365-importance-of-silk#.VCpd-GePLIV>. Fountain, Henry. The Reinvention of Silk. The New York Times 7 Mar. 2011, sec. Science: n. pag. The New York Times. Web. 25 Sept. 2014. Harding, John G., Lin M. Romer, and Thomas R. Scheibel. Polymeric Materials Based on Silk Proteins. Polymer 49.20 (2008): 4309-4327. Science Direct. Web. 25 Sept. 2014. Kitching, J. Howard. The Cultivation of a Silk Worm. The Decorator and Furnisher 5.2 (1884): 56. JSTOR. Web. 25 Sept. 2014. Muthu, Subramanian Senthilkannan. Assessing the Environtmental Impact of Textiles and the  Clothing Supply Chain. Wiltham MA: Woodhead Publishing Limited, 2014. Print. Soulivanh, Somphong. Environmental Impacts of Trade Liberalization in the Silk Handicrafts Sector of the Lao PDR. International Institute for Sustainable Development. International Institute for Sustainable Development, 1 Dec. 2007. Web. 25 Sept. 2014. Wild, Oliver. The Silk Road. The Silk Road. Earth System Science University of California, 1992. Web. 25 Sept. 2014. http://www.ess.uci.edu/~oliver/silk.html>.

Edgar Allan Poe Biography

Edgar Allan Poe Biography Edgar Allan Poe was an important writer of the 19th Century. His imaginative storytelling led to literary innovations and earned him the nickname Father of the Detective Story' (Bio.com). His short story, The Murders in the Rue Morgue is the first example of detective fiction. His writings were often dark and scary. He was an early writer of the horror story. Poe had a rough childhood, depression and dark moods as an adult, and a bad early death. Poes life and writings can be compared to the modern writer of horror, Stephen King. There are things that are alike about the two authors and things that are different. Poe was born on January 19, 1809 in Boston, Massachusetts. He never knew his parents, who were actors. His father, David Poe Jr., left the family and died in about 1810 or 1811. His mother, Elizabeth Arnold Poe, died of tuberculosis at the age of twenty four in 191. Poe was three at the time, and her death may have warped Poe for the rest of his life. He always remembered more or less unconsciously-his mother vomiting blood and being carried away from him forever by sinister men dressed in black (Asselineau 409). She had 3 three children, and Edgar was separated from his brother and sister. His brother, William, died young, and Rosalie lost her mind. Edgar was taken in but not adopted by John and Frances Valentine Allan. Edgar was close to Frances, but not to John. John was a prosperous tobacco merchant in Richmond Virginia, and wanted Edgar to join him as a clerk in his business. Frances was probably responsible for taking Poe in. He was a good poet by the time he was thirteen, but his headmaster and John discouraged his poetry. Sometimes they were nice to him and sometimes not. The family moved to England in 1815 where Poe attended a classical academy until 1820. Then they came back to Richmond where Poe attended the school of Joseph H. Clarke and wrote several poems in honor of local schoolgirls. Edgar was in love and secretly engaged to Elmira Royster when he went to the University of Virginia 1826. The engagement fell through. Edgar did well and made good grades, but John did not give him much spending money so he got lots of gambling debts. Some scholars think that Poe drank heavily during that time, but others say that even small amounts of alcohol had a bad effect on him. John refused to pay the debts, so in 1927 Poe joined the army. He came back two years later when he learned that Frances Allen was dying of tuberculosis, but she died before he came home. In 1930 Allan got him into WestPoint, but he was expelled for poor handling of his duties, so in 1831 so Allan disowned him. Historians also know that John Allan had gotten married again without telling him, so they fought. Some people think that Edgar got expelled on purpose to get back at John. When John died, he didnt leave any money to Edgar, but he did leave money to an illegitimate child Edgar had never met. Duri ng this time, Poe wrote several volumes of poetry including Tamerlane and Other Poems (1827), and Poems (1831). Historians do not know much else about his life during this time, but in 1832 he was working in Baltimore writing short stories. By 1833 he was living with his fathers widowed and poverty-stricken sister Mrs. Clemm in Baltimore and won a $50 prize for the story MS Found in a Bottle in a short story contest in The Baltimore Saturday Vister. He also started working on a play, Politician, which he never finished. He began working for the Southern Literary Messenger of Richmond and by 1835 was its editor. For most of the rest of his life he worked for various magazines but was usually fired because of his strange behavior made worse by alcoholism. He wrote many poems, stories, and articles which got him a little money and lots of criticism. They also made him well-known. His poems always had an easy, unforgettable rhythm, and his stories were always weird and concerned with death. He still lived most of the time with Mrs. Clemm, and married his 13-year-old cousin Virginia Clemm in 1836 who was his literary inspiration as well as his love interest (Biography.com). She was pale and fragile, like many of Poes characters. He was very devoted to her, but in 1842 she broke a blood vessel while singing. She recovered somewhat, but died in 1847 of tuberculosis. Her death caused him to ruin his life. Some historians believe that his alcoholism got worse and he took a lot of drugs. Others believe that he became ill and because of a brain lesion in his youth, had manic and depressive moods. He also began to give attention to other women and became engaged again to Elmira Royster Shelton who was now a widow. He continued to write and publish many stories and poems throughout this time. Historians do not know exactly what he did for the last of his life, and his final days remain somewhat of a mystery (Biography.com). He continued to be very distraught over Virginias death. On September 28, 1849 he attended a birthday party in Baltimore, drank wine, and went on a drinking spree. He was found ill in a Baltimore gutter on October 3, 1849. He was taken to Washington College Hospital where he died on October 7. His last words were Lord help my poor soul (Biography.com). He was buried in what is now Westminster Churchyard on October 8, 1849, and a monument was built to him later. Mrs. Clemm and her daughter are buried next to him. Edgar Allen Poes stories often have dark themes of death, lost love, or dying. His characters are often alcoholics or have drug addictions. They are not happy stories and his characters sometimes seem insane. A modern person who is like Edgar Allan Poe is the horror writer Stephen King. Both authors had a hard early life and were abandoned by their fathers when they were very young. They were both good students in elementary school and started writing when they were young. Both moved around a lot as children and were outsiders in high school. In college both of these writers started drinking. Also, both of them worked hard to make it where they got. Poe worked so hard that when he was 16, he swam 7 miles across the James River to prove himself, emulating Lord Byrons swimming across the Hellespont, as a physical expression of his determination to make a name for himself, to be a great writer (Hoffman 323). Both of the authors wrote about characters that had drug and alcohol problems. Stephen King has also written a lot of stories and is an important writer. Unlike Poe, Stephen King has had a long and successful career, is very famous and has made a lot of money. He is about sixty-five year s old and he is still writing. Edgar Allan Poe wrote many stories, poems, and other things. He was a very important writer of the 19th century and is still recognized as one of Americas most influential writers. Even though he wrote almost 200 years ago, his stories and poems still, shock, surprise, and move modern readers (Biography.com). However he never made very much money, was mostly unrecognized during his life time and died young. He will always be remembered for his fascinating and gruesome works. Bibliography Asselineau, Roger. Edgar Allan Poe. American Writers: Volume 3. Ed. Leonard Unger.  New York: Scribner, 1974. Hoffman, Daniel. Edgar Allan Poe. World Poets: Volume 2. Ed. Ron Padgett. New York:  Scribner, 2000. 323-331. Print. Perkins, George, Barbara Perkins, and Phillip Leininger, eds. Poe, Edgar Allen. Benets Readers Encyclopedia of American Literature. New York: Harper and Row, 1991.  853-6. Print. Unger, Leonard. American Writers: A Collection of Literary Biographies. New York: Scribner, 1974. 409-432. Print.

A Ladys Maid and Cinderella :: essays papers

A Ladys Maid and Cinderella The Lady’s Maid and Cinderella: Two Similar Storylines Children’s stories are often simple, with loveable characters and a feel-good ending. However, these simple plots sometimes have an underlying meaning that may be the basis for adult stories with social, intellectual, or emotional themes. For example, The Wizard of Oz, by L. Frank Baum, is not only about a girl who is looking for the way home who meets some charming friends along the way. It was written as Populist propaganda for the entire Populist movement of the early 1900’s! The children’s tale of Cinderella can be interpreted in much the same way. It portrays a young orphaned girl named Cinderella who is enslaved by her stepmother. She works diligently throughout her life, searching for love, comfort, and a home. The myth in Cinderella is very strong. The presence of a Fairy Godmother creates a supernatural element in the story. Through the mythical godmother, Cinderella eventually obtains happiness by marrying Prince Charming. In â€Å"The Ladyà ¢â‚¬â„¢s Maid,† by Katherine Mansfield, the narrator and maid is named Ellen. (Name similarity?) She, much like Cinderella, is loyal and quiet in performing her daily duties. Ellen is also searching for something to complete her life. But several incidents in Ellen’s life contribute to her un-Cinderella-like ending, including the fact that she does not have a mythical figure to help her out. These scenes, which are shown through Ellen’s responses to interactions with characters around her, prove Ellen to be a very complex character. Both Ellen and Cinderella experience sadness from childhood experiences and devotion to the ladies that they serve, but whereas Cinderella overcomes her problems in the end and finds happiness, Ellen carries her emotions so deeply that she cannot break free from her enslaved life. When comparing Cinderella and Ellen, a their childhoods are obviously similar in many respects. Both the girls lack a constant loving home and a strong mother figure. Losing a parent at a young age is distressing to Cinderella in much the same way as it is for Ellen. Because the girls were never close with their parents because of death, they never developed the ties of loving mother-daughter relationships. Cinderella worked for her stepmother at a very young age, and after Ellen lived with her grandfather and an aunt, she was sent to work as a maid at age thirteen.

Health and Diet Essay -- essays research papers

Health and Diet Abstract: With my personal life experience I'd like to clarify that a healthy diet and physical exercises help to lose weight. This passage introduces some scientific means to keep fit and, from both sides, indicates the effection that it may have brought along. Another point is that one should choose an appropriate way according to his personal case. Frustration and troubles are often met, but how to deal with them depend on ourselves. What is cricial is about persistence, optimism and rationalism.  ¢Ãƒ ±.Introduction £Ã‚ ºKeeping-fit is sweeping us while some irrational ideas, rather than appropriate ways to lose fat are penetrating into our life. Most people don't employ scientific ways so that body was badly damaged, even never repaired automatically. We recommend appropriate ways which not only perform the function of losing weight, also continue to help to establish personal confidence. One could enjoy the whole process rather than sense some burden. This passage wants to tell us the importance of scientific means to keep fit and take some focus on emotional change when dieting.  ¢Ãƒ ².Body: Keeping fit, at any present time, may fill up your mind. Dieting and sports have come by, playing the theme of the life. Now our focus is on which way to be the best way for you to keep fit. In my grade 3 of senior high school, I weighed 80 KG. I had been embarrassed to be of that kind of figure, when looking at myself, let alone when accepting others ¡Ã‚ ¯ unusual sight and ...

Managing Working Capital

MANAGING WORKING CAPITAL Cash Budgets and Current Assets Learning Objectives Upon reading this chapter, students should: †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Be able to compare and contrast working and fixed capital †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Understand the impact of the operating cycle on the size of investment in accounts receivable and inventories †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Know the differences between the three motives †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Be able to differentiate between float, collection float, and disbursement float †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Know how to appraise a firm’s credit worthiness †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Be able to appraise the effectiveness of a firm’s inventory management policiesChapter Summary A firm can invest in both working capital and fixed capital. Working capital is a firm’s current assets and includes cash, marketable securities, inventory, and accounts receivable. Fixed capital is a firm’s fixed assets and includes plant, equipment and property. Firms that cannot obtain short-term financing become candidates for bankruptcy. Management of working capital is particularly important to the entrepreneurial or venture firm because there is such a pull on resources.Two important concepts in managing working capital are the operating cycle and the cash conversion cycle: †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The operating cycle measures the time between receiving raw materials and collecting the cash from credit sales posted to accounts receivable †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The cash conversion cycle measures the time it takes to collect money from the company’s customers and use those funds to pay its suppliers Calculating three ratios will reveal the average length of these cycles: 1. Inventory days     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   =   365 / (Cost of goods sold / Inventories) 2.Accounts receivable period (average collection period ) =   Accounts receivable / (Net sales / 365) 3. Average payment period   =   Accounts payable / (Cost of goods sold / 365) The operating cycle is the inventory conversion period plus the average collection period. The cash conversion cycle is the operating cycle minus the average payment period. In order to determine average investment in accounts receivable, multiply net sales per day by the average collection period. With this number, a manager can now estimate what the investment in accounts receivable will be fore ht following year given sales increases and average collection period.In order to determine investment required in inventories, multiply average cost of goods sold per day by inventory conversion period. The required amount of accounts payable can be found by multiplying the cost of goods sold per day by average payment period. Armed with these numbers, a manager can tweak the business practices and use these numbers as metrics for improvement. If savings can be wrung out of the operating cycle and conversion cycle, this means less money will have to be raised in financing. A cash budget details the cash inflows and outflows of a firm over a specific time frame.Small firms may prepare annual or monthly cash budgets while larger firms will forecast cash flows weekly or daily. Most firms have a minimum desired cash balance that depends on the firm’s ability to acquire financing on short notice, management preferences, and the predictability of cash inflows and outflows. Estimates of cash inflows are driven by two main factors: 1. Sales forecast (may exhibit seasonality) 2. Customer payment patterns Cash outflows will go to suppliers, payroll, taxes, operating expenses, and purchases of plant and equipment.In order to construct the cash budget, list all expected cash inflows and then all expected cash outflows for the particular period, generating a net cash flow amount. As a general rule of thumb, the average firm has 1/3 or more of i ts assets in the form of current assets (cash, accounts receivable and inventory). Seasonal production and forecasting can lead to idle plant capacity and laid-off workers during the off-season. Under a level production plan, the same amount of raw material is purchased and the same amount of finished product is manufactured every month.There are three types of motives for holding cash: 1. The transactions motives are demands for holding cash – cash is needed to conduct day-to-day operations 2. Precautionary motives are demands that may be caused by unpredictable events, such as delays in production or in the collection of receivables; marketable securities are held in such a contingency 3. Speculative motives are demands for funds to take advantage of unusual cash discounts for needed materials Cash and marketable securities include: †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Cash itself †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   U. S. Treasury bills   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Commercia l paper – short-term, unsecured notes of well-known business firms †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Negotiable certificates of deposit – a receipt issued by a bank in exchange for a deposit of funds †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Bankers’ acceptances – primarily used to finance exports and imports †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Eurodollars – deposits placed in foreign banks that remain denominated in U. S. dollars There are several reasons why U. S. banks have entered the Eurodollar market through overseas branches: 1. To finance business activity abroad 2. To switch Eurodollars into other currencies 3. To lend to other Eurodollar banksIn general, managers try to speed up cash collections while slowing down the payment process. The float is the time between sending out payments and having them actually be charged to the bank account. The collection float is the time between when a payer sends payment and funds are credited to the payee ’s bank account. The disbursement float is the time between when a payer sends payment and when the funds are deducted from the payer’s bank account. Float has three components: 1. Delivery or transmission float – the delay in transferring the means of payment from the payer (customer) to the payee (provider of goods/services) 2.Processing float – once payment reaches the destination, it needs to be entered and processed 3. Clearing float – delay in transferring funds because of the banking system itself In order to speed up the process: †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Preauthorized checks are regular (typically monthly) deductions by a vendor from a customer’s checking account. †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Under the Check 21 law, enacted in 2004, payee banks can present electronic or digital images of checks to payer banks rather than having to physically deliver the paper checks for payment.In order to facilitate sales, firms of ten offer the customers credit for purchases; this process calls in credit analysis. The five Cs of credit analysis are: 1. Character – ethical quality of the applicant and the history of paying bills on time (credit checks) 2. Capacity – the ability to pay bills (liquidity ratios) 3. Capital – adequacy of owners’ equity relative to existing liabilities 4. Collateral – whether assets are available to provide security 5. Conditions – current economic climate and state of the business cycleCredit bureaus obtain credit information about business firms and individuals; two such organizations are Experian and Equifax. Dun & Bradstreet reports contain information assembled through many channels and is one of the best sources of information on privately-held companies; reports are typically divided into five sections:   (1) rating and summary; (2) trade payments; (3) financial information; (4) operation and location; and (5) history. Trade credit is extended on purchases to a firm’s customers. Sometimes, customers are given a discount if they pay early.The financial manager must be careful not to impose onerous credit terms that will alienate customers and lower sales. With respect to global credit, the concern is forex. There are two ways to handle the issue: 1. Invoice customers in the firm’s home currency 2. Hedge the forex risk Inventory management: †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The just-in-time (JIT) inventory control system is a system where there are enough materials in inventory to cover needs for a short time, but not more inventory than is needed for short-term needs.Vendor and manufacturer work together to reduce lead time, setup time, and production time so that inventory shows up â€Å"just in time†Ã‚   †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   JIT II further integrates the activity of vendor and purchaser, wherein the position of buyer’s purchasers or materials planners is eliminate d and replaced by a representative of the supplier †¢Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Tracking inventory also allows firms to reduce the inventory conversion period and the cash conversion cycle. RFID (radio frequency identification) tags send out a radio signal to electronic readers that allow companies to know the location of inventory at any timeInventory management can result in reduced cost of warehousing and handling inventory. Cost savings and smaller asset bases should lead to higher return on assets and increasing shareholder wealth. Technology is improving asset management by making information available with which managers make business decisions in a real-time setting. Technology may be the key to reducing procurement and supply chain costs. Portals are specialized and secure Web sites through which clients can access order and account information. Key TermsCapacity  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The ability to pay bills and often involves an examination of liquidity ratios. Capital  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The adequacy of owners’ equity relative to existing liabilities as the underlying support for creditworthiness. Cash budget  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The cash inflows and cash outflows of a firm over a specific time frame. Cash conversion cycle  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The time it takes to collect money from the company’s customers and use those funds to pay its suppliers.Character  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The ethical quality of the applicant and his/her willingness to pay bills on time and is best judged by reviewing the past credit hist ory for the company or person. Collateral  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Assets that secure credit. Collection float  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The time between when a payer sends payment and the   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   funds are credited to the payee’s bank account. Conditions  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The current economic climate and state of the business cycle.They are an important consideration in assessing whether the applicant can meet credit obligations. Credit bureaus  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Firms that obtain credit information about   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   business firms and individuals. Disbursement float  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The time between when a payer sends payment and when the funds are deducted from the payer’s bank account. Fixed capital  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   A firm’s fixed assets, which include plant, equipment, and property. Float  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The time between sending out payments and having them actually be charged to the bank account.Level production plan  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Schedule where the same amount of raw material is purchased and the same amount of finished product is manufactured every month. Operating cycle  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The time between receiving raw materials and collecting the cash from credit sales posted to accounts recei vables. Portals  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Specialized and secure web sites through which clients can access order and account information. Pre-authorized checks  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Regular (typically monthly) deductions by a vendor from a customer’s checking account.Precautionary motives  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Demands for funds that may be caused by   unpredictable events, such as delays in production   or in the collection of receivables. Speculative motives  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Demands for funds to take advantage of unusual cash discounts for needed materials. Trade credit  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Credit that is extended on purchases to a firm’s customers. Transactions motives  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Demands for holding cash is that cash is needed to conduct day-to-day operations.Working capital  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   A firm’s current assets as shown on the balance sheet and includes cash in the bank accounts, marketable securities, inventory, and accounts receivable. Suggestions for Additional Resources 1. http://en. wikipedia. org/wiki/Just_In_Time_%28business%29 2. http://www. lean. org/ 3. http://www. equifax. com/ 4. http://www. experian. com/ 5. http://www. investopedia. com/terms/c/creditbureau. asp 6. http://en. wikipedia. org/wiki/Credit_bureau 7. http://www. investopedia. com/terms/w/workingcapital. asp 8. http://en. wikipedia. org/wiki/Working_capitalAnswers to Summary Questions 2. Fixed capital would be defined as the firm’s fixed assets, which include plant, equipment and property. True or false? True. .   3. The operating cycle measures the time it takes between o rdering materials and collecting cash from receivables. True or false? True. .   4. If a firm has $50,000 in profit and pays out about one half to the owners of the company, the amount of profit retained in the firm would show up as: (a) an increase in owners’ equity (b) a decrease in owners’ equity (c) a decrease in retained earnings (d) a decrease in long-term debt .   5.The accounts payable period is the time between a firm’s paying its suppliers for inventory and collecting cash from inventories. True or false? False. .   6. Increases in the cash conversion cycle will lower the firm’s short-term financing needs. True or false? False. .   7. The inventory conversion period is calculated by inventory divided by costs of goods sold. True or false? False. .   8. Activities that decrease the cash conversion cycle will increase the firm’s need to obtain financing. True or false? False. .   9. More efficient management of working capital a ssets will lessen the firm’s needs for financing.True or false? True. . 10. A cash budget is a tool the treasurer uses to forecast future cash flows and estimate future short-term borrowing needs. True or false? True. . 11. To construct a cash budget, two sets of information are needed: estimated cash inflows and estimated cash outflows. True or false? True. . 12. The estimated cash inflows are affected by the sales forecast and customer payment patterns. True or false? True. . 13. Assume a firm’s production process requires an average of 80 days to go from raw materials to finished products and another 40 days before the finished goods are sold.If the accounts receivable cycle is 70 days and the accounts payable cycle is 80 days, what would the short-term operating cycle be? (a) 110 days (b) 130 days (c) 190 days (d) 270 days . 14. If a firm has net sales of $400,000, annual cost of goods sold of $315,000, an inventory turnover of 4. 5 times a year, and an accounts re ceivable turnover of five times a year, the combined investment in inventories and accounts receivable would be: (a) $64,500 (b) $92,000 (c) $122,500 (d) $150,000 . 15. Calculation of a firm’s average collection period is the same as calculating the: (a) accounts receivable cycle (b) inventory cycle c) accounts payable cycle (d) short-term operating cycle . 17. A level production plan has problems, such as idle plant and laid-off workers during slow sales months and production bottlenecks during busy times. True or false? False. . 18. The account receivable period may be calculated as accounts receivable divided by sales. True or false? False. . 19. The account receivable period may be calculated as accounts receivable divided by daily sales. True or false? True. . 20. The transactions motive is the demand for holding cash. True or false? True. . 22. The federal funds rate is normally several points lower than the Treasury Bill rate.True or false? False. . 23. The five C†™s of credit analysis is a popular concept used by inventory managers. True or false? False. . 24. A mercantile credit bureau serves primarily as a (n): (a) collection agency for delinquent accounts (b) common meeting place where credit managers may exchange information (c) organization through which accounts receivable may be sold to other businesses (d) central record-keeping organization for credit information on business firms . 25. The objective of just-in-time (JIT) inventory control is to carry a minimum level of inventories.True or false? True. . 26. The delivery or transmission float is the delay in transferring the means of payment from the payer (customer) to the payee (the provider of goods or services). True or false? True. . 27. The disbursement float is the delay in transferring the means of payment from the payer (customer) to the payee (the provider of goods or services). True or false? False. Answers to â€Å"Review Questions† .   1. What is meant by wor king capital? Net working capital is defined as current assets minus current liabilities. .   2. Briefly describe a manufacturing firm’s operating cycle.The operating cycle measures the time between receiving materials and collecting cash from receivables. Raw materials are purchased and products are manufactured from them to become finished goods. Effort then is made to sell the finished goods. If the goods are sold on credit, then the receivables must be collected. .   3. Explain how the cash conversion cycle differs from the operating cycle. The cash conversion cycle typically is shorter than the operating cycle. The cash conversion cycle measures the time between when a firm pays for its supplies or raw materials and when it collects cash from receivables.    4. Describe how the length of the cash conversion cycle is determined. It is equal to the operating cycle (inventory period minus the accounts receivable period) minus the payables period. .   5. Explain how the length of the operating cycle affects the amount of funds invested in accounts receivable and inventories. All else being equal, a longer (shorter) inventory period and receivables period will increase (decrease) the amount of inventory and accounts receivable carried by the firm. .   6. What affects the amount of financing provided by accounts payable as viewed in terms of the cash conversion cycle?The level of the firm’s cost of goods sold and the average payment period affect the amount of financing provided by accounts payable. .   7. What is a cash budget? How does the treasurer use forecasts of cash surpluses and cash deficits? A cash budget lists, period by period, expected cash inflows and outflows. The treasurer can plan ahead to find suitable marketable securities in which to invest excess cash. If cash deficits are forecast, the treasurer can arrange for short-term financing sources. .   8. Three sets of information are needed to construct a cash budget.E xplain what they are. The firm’s minimum desired cash balance, forecasted cash inflows, and forecasted cash outflows are needed to construct a cash budget. .   9. Why might firms want to maintain minimum desired cash balances? Firms want to maintain minimum desired cash balance to ensure they can pay bills on time (transactions motive) and to have a cushion, as forecasts of cash flows may differ from actual future cash flows. . 10. What are the sources of cash inflows to a firm over any time frame? The main sources of cash inflows are cash sales and customer payments on credit sales. . 11.What are the sources of cash outflows from a firm over any time frame? The main sources of cash outflows are payments for raw materials, labor and overhead expenses, rent/lease payments, plant and equipment purchases, interest and principal payments, dividend payments, and taxes. . 12. How does the choice of level or seasonal production affect a firm’s cash over the course of a year ? Under level production, inventory becomes large before the peak selling season; whatever cash the firm has will probably be borrowed funds as cash is used to pay workers and suppliers over the course of the year as inventories are building.Under seasonal production, there is still a build-up of inventories prior to the selling season but probably less than under level production, as inventory can be sold shortly after it is made. Cash is conserved for much of the year; materials and labor expenses are less during the off-peak times when production is low. . 13. Describe what happens to a firm’s current asset accounts if the firm has seasonal sales and they use (a) level production; (b) seasonal production. a. Under a level production plan, the same amount of raw materials are purchased and the same amount of finished product is manufactured every month.Inventory builds up in anticipation of higher seasonal sales while cash and accounts receivable are quite low. When the sel ling season begins, inventories fall and receivables rise. After a time, inventories are nearly exhausted, and the firm is collecting cash from its customers. The changing composition of current assets for a firm with a seasonal sales pattern is illustrated in Figure 15. 4. b. Under seasonal production, raw material purchases will rise or fall in anticipation of higher or lower sales.Such a strategy can help minimize the effect of seasonal sales on inventory; goods are manufactured shortly before sale. Receivables will rise during the peak selling season but will fall thereafter as cash is collected. . 14. Describe the three motives or reasons for holding cash. a. need for day-to-day bill-paying? Transactions motive: b. hold funds to meet unexpected needs—a safety level of? Precautionary motive: cash hold funds? c. Speculative motive: to take advantage of attractive input prices or discounts 15. What characteristics should an investment have to qualify as an acceptable market able security?Marketable securities must be highly liquid (easily converted into cash at a price close to fair market value) with little chance of price risk or default risk. . 16. Identify and briefly describe several financial instruments used as marketable securities. Marketable securities that can be used as a means to â€Å"park† the firm’s excess cash include a. short-term securities issued and backed by the U. S.? U. S. Treasury Bills: government b. a bank’s temporary excess reserves that are lent to other banks? Federal Funds: on a day-to-day basis c. short-term unsecured notes of large financially stable? Commercial Paper: firms . large dollar CDs ($100,000 or more) for? Negotiable Certificates of Deposit: which a secondary market has evolved e. business paper used to finance international trade, backed? Bankers’ Acceptances: (accepted) by a bank with a high quality rating f. deposits placed in foreign banks that remain denominated in U. S.? Euro dollars: dollars (so there is no currency risk) . 17. What is float? Why is it important to cash management? Float is the delay between when funds are sent by a payer to a payee. Collection float is the time between when a payer sends payment and the funds are credited to the payee’s bank account.Disbursement float is the time lag between when a payer sends payment and when the funds are deducted from the payer’s bank account. It is important to cash management as the firm will have larger cash balances to invest and to reduce its own financing needs, all else being equal, the shorter the collection float and the larger the disbursement float. . 18. What are the three components of float? Which are under the control of the firm seeking to reduce collection float? The three components of float are delivery (or transmission) float, processing float, and clearing float.Delivery float and processing float are most directly under the control of the firm. Clearing float is c ontrolled mainly by the banking system’s check-clearing process but the firm can try to reduce it (and delivery float) by using lockboxes that are geographically closer to customers then the firm’s main office. . 19. What are some strategies a firm can use to speed up its collections by reducing float? Using a lockbox, incoming receipts are placed in a Post Office box which can be emptied several times a day by bank personnel, who process the payments and deposit the incoming funds into the firm’s accounts.This reduces mail delivery delay and processing delay, as the bank processes the payments rather than the firm. A second popular method, best used for regular payments such as utility, cable bills, or insurance premiums, is the use of preauthorized checks that allow the firm to deduct funds from the payer’s bank account. . 20 How can processing float be reduced? Vendors reduce processing float by improving the process of receiving payments and depositin g them. Large incoming payments (say, over $1 million) are automatically flagged and deposited expeditiously.Electronic check images and electronic payments (rather than the use of paper checks) remove the human component and thus can reduce processing delays. Lockboxes and preauthorized checks reduce processing delays, as processing is handled by banks, speeding deposit of incoming receipts. .. 21. How can a firm use float to slow down its disbursements? A firm can increase mail float by mailing payments from out-of-the-way locations, but that may hurt its reputation with suppliers who can direct the firm to send payments to another, closer, lockbox location.Another means are to use disbursement banks that are located around the country to increase disbursement float via the check-clearing process. So excess (and noninterest bearing) funds are not kept in a disbursement account, a firm can arrange to use a zero balance account for its disbursements. A bank will transfer sufficient funds every day into the ZBA to cover the day’s presented checks; other funds can remain invested in marketable securities. . 22. Why can’t a firm that wants to increase disbursement float simply make payments after the stated due date?There is an ethical issue with paying invoices late. If a vendor has provided needed goods and services the customer should pay for them in a timely and appropriate manner. Paying late can lead to negative notations on credit reports. Credit availability to late payers can be discontinued if the vendor’s credit standards are tightened. . 23. What is credit analysis? Identify the five C’s of credit analysis. Credit analysis involves appraising the creditworthiness or quality of a potential credit customer. Credit analysis includes examining the 5 C’s of credit. a. illingness to repay debts? Character: b. ability to repay debts (liquidity)? Capacity: c. equity cushion? Capital: d. what assets can provide security for t he credit? Collateral: e. the state of the business cycle and its expected movement during the? Conditions: credit period . 24. Describe various credit-reporting agencies that provide information on business credit applicants. Credit bureaus provide firms with information about a firm’s financial condition and its record on paying its past debts. Local credit bureaus service community credit information needs.The National Credit Interchange System facilitates exchange of information between bureaus. The National Association of Credit Management established the Foreign Credit Interchange Bureau to service firms with overseas customers. Dun & Bradstreet is perhaps the best-known private firm supplying credit information. . 25. How can a firm control the risk of changing exchange rates when billing an overseas customer? First, a firm can invoice the overseas customer in the firm’s home currency; this transfers the risk of changing exchange rates to the customer.Second, if the customer may pay in their own currency, the supplier can use currency futures or options contracts to hedge or reduce the risk of changing exchange rates. . 26. What risks arise when a firm lowers its credit standards to try to increase sales volume? Marginal and poor-risk customers may purchase the firm’s goods/services on credit. If they are unable to make payment, the firm must revise its sales figures and faces the added expense of trying to recover the goods and whatever funds it can from the delinquent customer. . 27. How do credit terms and collection efforts affect the investment in accounts receivable?All else being equal, lax credit terms increase the investment in accounts receivable and increase the chance for larger bad debts. Stricter credit terms will likely reduce receivables balances, but at the cost of possibly losing sales to competitors with easier standards. Collection efforts are aimed at having customers with overdue accounts pay their bills. Thus, successful collection efforts can reduce receivable balances and bad debt expense. On the other hand, collection efforts that offend customers can lead to lost future business. 28. How is the financial manager involved in the management of inventories? Inventory management concerns the financial manager because inventory, like all other assets, must be financed. Overly large inventories use warehouse space and have larger financing costs and insurance costs. Smaller inventories run the risk of selling out and causing customer dissatisfaction. Answers to â€Å"Applying this Chapter† Questions 2. The Robinson Company has the following current assets and current liabilities for these two years: 2004   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   2005 Cash and marketable securities |$50,000 |$50,000 | |Accounts receivable |300,000 |350,000 | |Inventories |350,000 |500,000 | |Total current assets |$700,000 |$900,000 | |Accounts payable |$200,000 |$250,000 | |Bank loan |0 |150,000 | |Accruals |150,000 |200,000 | |Total current liabilities |$350,000 |$600,000 | |   |   |   | If sales in 2004 were $1. 2 million and sales in 2005 were $1. 3 million, and cost of goods sold was 70 percent of sales, how long were Robinson’s operating cycles and cash conversion cycles in each of these years? What caused them to change during this time?AR period = $350,000/($1,300,000/365) = 98. 27 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $300,000/($1,200,000/365) = 91. 25 days (2004) Inventory period  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $500,000/($910,000/365) = 200. 55 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $350,000/($840,000/365) = 152. 08 days (2004) AP period   = $250,000/($910,000/365 ) = 100. 27 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $200,000/($840,000/365) = 86. 90 days (2004) Operating cycle = AR period + Inventory period = 98. 27 + 200. 55 = 298. 82 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 91. 25 + 152. 08 = 243. 33 days (2004) Cash conversion cycle = Operating cycle – AP period = 298. 82 – 100. 27 = 198. 5 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 243. 33 –   86. 90 = 156. 43 days (2004) Both the OC and CCC rose in 2005, primarily because of a large rise (almost 48 days) in the inventory period. 5. The Robinson Company from Problem 2 had net sales of $1,200,000 in 2004 and $1,300,000 in 2005. (a)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Determine the receivables turnover in each year. AR turnover  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = Sales/AR = $1,300,000/$350,000 = 3. 71 (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $1,200,000/$300,000 = 4. 00 (2004) (b)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Calculate the average collection period for each year. Average collection period  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = AR/(Sales/365)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $350,000/($1,300,000/365) = 98. 7 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $300,000/($1,200,000/365) = 91. 25 days (2004) (c)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Based on the receivables turnover for 2004, estimate the investment in receivables if net sales were $1,300,000 in 2005. How much of a change in the 2005 receivables occurred? Receivables investment  Ã‚  Ã‚  Ã‚  Ã‚   = Sales per day ? Average collection period   Ã‚  Ã ‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = ($1,300,000/365) ? 91. 25 days = $325,000 6. Suppose the Robinson Company had a cost of goods sold of $1,000,000 in 2004 and $1,200,000 in 2005. (a)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Calculate the inventory turnover for each year. Comment on your findings.Inventory turnover  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = COGS/Inventory = $1,200,000/$500,000 = 2. 40 (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $1,000,000/$350,000 = 2. 86 (2004) Inventory turnover fell in 2005; inventory rose more quickly than cost of goods sold. (b)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   What would have been the amount of inventories in 2005 if the 2004 turnover ratio had been maintained? Inventories investment  Ã‚  Ã‚  Ã‚  Ã‚   = COGS per day ? Inventory period   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $1,200,000/365 ? (365/2. 86) = $419,580. 42 7. Given Robinson’s 2004 and 2005 financial information presented in problems 2 and 4,   Ã‚  Ã‚  Ã‚   (a)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Compute its operating and cash conversion cycle in each year. Robinson Company |   |   |   |   | |   |2004 |   |2005 |   | |Sales |$1,200,000 |   |$1,300,000 |   | |Cost of Goods sold |$1,000,000 |   |$1,200,000 |   | |profit margin |5. 0% |   |5. 0% |   | |   |   |   |   |   | |Accounts Receivable |$300,000 |   |$350,000 |   | |Inventory |$350,000 | $500,000 |   | |Accounts Payable |$200,000 |   |$250,000 |   | |   |   |   |   |   | |Sales/ day = |$3,287. 67 |   |$3,561. 64 |= $1,300,000/365 | |COGS/day= |$2,739. 73 |   |$3,287. 67 |= $1,200,000/366 | |   |   |   |à ‚   |   | |Inventory conversion period = Inventory/COGS per day | |   |127. 75 |days |152. 8 |days | |   |   |   |   |   | |Average collection period = AR/sales per day |   | |   |91. 25 |days |98. 27 |days | |   |   |   |   |   | |Average payment period = AP/COGS per day |   | |   |73. 0 |days |76. 4 |days | |   |   |   |   |   | |Operating cycle = Inventory conversion + collection periods | |   |219. 00 |days |250. 35 |days | |   |   |   |   |   | |Cash cycle = Inventory conversion + collection period – payment period | |   |146. 00 |days |174. 31 |days | (b)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   What was Robinson’s net investment in working capital each year? |Net investment in working capital = AR + Inventory – AP (as used in his chapter) | |   |2004 |   |2005 |   | |   |=$300,000+$350,000-$200,000 |=$350,000+$500,000-$250,000 | |   |=$450,000 |   |=$600,000 |   | 8. Robinson expects its 2006 sales and cost of goods sold to grow by 5 percent over their 2005 levels. (a)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   What will be the affect on its levels of receivables, inventories, and payments if the components of its cash conversion cycle remain at their 2005 levels? What will be its net investment in working capital? If the ratios remain the same, a |   |   | |5 |percent increase in sales and COGS will increase AR, | |inventory, and AP proportionately in 2006 |   |   | |AR: $350,000 + 5%= |$367,500 |   |   | |Inv: $500,000 + 5%= |$525,000 |   |   | |AP: $250,000 + 5%= |$262,500 |   |   | |Net investment in working capital = AR + Inventory – AP |   | |=$367,500 + $525,000 – $262,500 = |$630,000 |   | |   |   |   |   | |The new sales will be |$1,300,000 + 5% = |$1,365,000 |   | |Sales/day = |   |$3,739. 3 |   | |The new COGS will be |$1,200,000 + 5% = |$1,260,000 |   | |COGS/day = |   |$3,452. 05 |   | (b)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   What will b e the impact on its net investment in working capital in 2006 if Robinson is able to reduce its collection period by five days, its inventory period by six days, and increase its payment period by two days? |The new sales will be |$1,300,000 + 5% = |$1,365,000 | |Sales/day = |   |$3,739. 3 | |The new COGS will be |$1,200,000 + 5% = |$1,260,000 | |COGS/day = |   |$3,452. 05 | |Estimated AR if collection period reduced by |5 |days: | |New AR = sales/day x collection period |   |   | |Sales/ day = |$3,739. 73 |   |   | |Old collection period |98. 27 |   |   | |New collection period |93. 27 |   |   | |New AR estimate= |$348,801. 7 |   |   | |   |   |   |   | |Estimated inventory if conversion period reduced by |6 |days: | |New Inv = COGS/day x conversion period |   |   | |COGS/day |$3,452. 05 |   |   | |Old conversion period |152. 08 |   |   | |New conversion period |146. 08 |   |   | |New Inv estimate= |$504,287. 7 |   |   | |   |   |   |   | |Estimated AP if payment period increased by |2 |days: | |New AP = sales/day x payment period |   |   | |COGS/day |$3,452. 05 |   |   | |Old payment period |76. 04 |   |   | |New payment period |78. 04 |   |   | |New AP estimate= |$269,404. 1 |   |   | |   |   |   |   | |2006 working capital = AR + Inventory – AP |   |   | |=$360,020. 55 + $514,643. 84 – $259,047. 95 |   |   | |=$583,684. 93 |   |   |   | |which is a reduction of |$46,315. 07 |from part a) | 9. Robinson expects its 2006 sales and cost of goods sold to grow by 20 percent over their 2005 levels. (a)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   What will be the affect on its levels of receivables, inventories, and payments if the components of its cash conversion cycle remain at their 2005 levels? What will be its net investment in working capital? If the ratios remain the same, a |   |   | |20 percent increase in sales and COGS will increase AR, | |inventory, and AP proportionately in 2006 |   |   | |AR: $350,000 + 5%= |$420,000 |   |   | |Inv: $500,000 + 5%= |$600,000 |   |   | |AP: $250,000 + 5%= |$300,000 |   |   | |Net investment in working capital = AR + Inventory – AP |   | |=$367,500 + $525,000 – $262,500 = |$720,000 |   | |   |   |   |   | |The new sales will be |$1,300,000 + 20% = |$1,560,000 |   | |Sales/day = |   |$4,273. 97 |   | |The new COGS will be |$1,200,000 + 20% = |$1,440,000 |   | |COGS/day = |   |$3,945. 21 |   | b)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   What will be the impact on its net investment in working capital in 2006 if Robinson is able to reduce its inventory period by ten days? |Estimated AR if collection period reduced by 0 days: | |New AR = sales/day x collection period |   |   | |Sales/ day = |$4,273. 97 |   |   | |Old collection period |98. 27 |   |   | |New collection period |98. 27 |   |   | |New AR estimate= |$420,000. 0 |   |   | |   |   |   |   | |Estimated inventory if conversion period reduced by 10 days: | |New Inv = COGS/day x conversion period |   |   | |COGS/day |$3,945. 21 |   |   | |Old conversion period |152. 08 |   |   | |New conversion period |142. 08 |   |   | |New Inv estimate= |$560,547. 5 |   |   | |   |   |   |   | |Estimated AP if payment period increased by 0 days: | |New AP = sales/day x payment period |   |   | |COGS/day |$3,945. 21 |   |   | |Old payment period |76. 04 |   |   | |New payment period |76. 04 |   |   | |New AP estimate= |$300,000. 0 |   |   | |   |   |   |   | |2006 working capital = AR + Inventory – AP |   |   | |=$360,020. 55 + $514,643. 84 – $259,047. 95 |   |   | |$680,547. 95 |   |   |   | |which is a reduction of |$39,452. 05 |from part a) |   | 10. Following are financial statements for the Genatron Manufacturing Corporation for the years 2004 and 2005: Selected Balance Sheet Information 2004   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   2005 Cash |  $ 50,000 |$ 40,000 | |Accounts receivable |200,000 |260,000 | |Inventory |450,000 |500,000 | |Total current assets |$700,000 |$800,000 | |Bank loan, 10% |$ 90,000 |$ 90,000 | |Accounts payable |130,000 |170,000 | |Accruals |50,000 |70,000 | |Total current liabilities |$270,000 |$330,000 | |Long-term debt, 12% |300,000 |400,000 | Selected Income Statement Information 2004   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   2005 |Net sales |$1,300,000 |$1,500,000 | |Cost of goods sold |780,000 |900,000 | |Gross profit |$ 520,000 |$ 600,000 | |Net income |$93,000 |$ 114,000 |Calculate Genatron’s operating cycle and cash conversion cycle for 2004 and 2005. Why did they change between these years? Inventory period  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = Inventory/(COGS/365)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $500,000/($900,000/ 365) = 202. 78 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $450,000/($780,000/365) = 210. 58 days (2004) AR period = AR/(Sales/365) = $260,000/($1,500,000/365) = 63. 27 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $200,000/($1,300,000/365) = 56. 15 days (2004) AP period   = AP/(COGS/365) = $170,000/($900,000/365) = 68. 94 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = $130,000/($780,000/365) = 60. 83 days (2004) Operating cycle   = Inventory period + AR period 202. 78 days + 63. 27 days = 266. 05 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 210. 58 days + 56. 15 days = 266. 73 days (2004) Cash conversion cycle = Operating cycle – Average payment period   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 266. 05 days – 68. 94 days = 197. 11 days (2005)   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   = 266. 73 days – 60. 83 days = 205. 90 days (2004) The operating cycle remained constant in 2004 and 2005 as a reduction in the inventory period was balanced by an increase in the average collection period. The cash conversion cycle sell for 2005 was longer. Genatron took, on average, longer to pay its suppliers. 11.Genatron Manufacturing expects its sales to increase by 10 percent in 2006. Estimate the firm’s investment in accounts receivable, inventory, and accounts payable in 2006. If the inventory, collection, and payment periods remain constant, each account should rise by 10 percent. $260,000 (1. 10) =? Accounts receivable: $286,000 $500,000 (1. 10) = $550,000? Inventory: $170,000 (1. 10) = $187,000? Accou nts payable: 12   . With concerns of increased competition, Genatron is planning in case its 2006 sales fall by 5 percent from their 2005 levels. If cost of goods sold and the current asset and liability accounts decrease proportionately, (a) Calculate the 2006 cash conversion cycle.    |   |   |   |   |5% decline | |   |2004 |   |2005 |   |2006 | |Sales |$1,300,000 |   |$1,500,000 |   |$1,425,000 | |Cost of Goods sold |$780,000 |   |$900,000 |   |$855,000 | |profit margin |7. 2% |   |7. 6% |   |   | |Net income |$93,000 |   |$114,000 |   |   | |Accounts Receivable |$200,000 |   |$260,000 |   |$247,000 | Inventory |$450,000 |   |$500,000 |   |$475,000 | |Accounts Payable |$130,000 |   |$170,000 |   |$161,500 | |   |   |   |   |   |   | |Sales/ day = |$3,561. 64 |   |$4,109. 59 |= $1,500,000/365 |$3,904. 11 | |COGS/day= |$2,136. 99 |   |$2,465. 75 |= $900,000/366 |$2,342. 47 | |   |   |   |   |   |   | |Inv entory conversion period = Inventory/COGS per day |   | |   |210. 58 |days |202. 78 |   |202. 8 | |   |   |   |   |   |   | |Average collection period = AR/sales per day |   | |   |56. 15 |days |63. 27 |   |63. 27 | |   |   |   |   |   |   | |Average payment period = AP/COGS per day |   | |   |60. 8 |days |68. 94 |   |68. 4 | |   |   |   |   |   |   | |Operating cycle = Inventory conversion + collection periods |   | |   |266. 73 |days |266. 04 |   |266. 04 | |   |   |   |   |   |   | |Cash cycle = Inventory conversion + collection period – payment period |   | | |205. 90 |days |197. 10 |   |197. 10 | (b) Calculate the 2006 net investment in working capital. Net investment in working capital = AR + Inventory – AP (as used in this chapter) | |2004 |2005 |2006 |   |   | |   |   |=$247,000+$475,000-$161,500 | |$520,000 |$590,000 |=$560,500 |   |   | 13. .In problem 10 we assumed t he current asset and liability accounts decrease proportionately with Genatron’s sales. This is probably unrealistic following a decline in sales.What will be the impact on the working capital accounts if its collection period lengthens by five days, its inventory period lengthens by seven days, and its payment period lengthens by three days if Genatron’s sales and COGS fall 5 percent from their 2005 levels? |The new sales will be |$1,500,000 – 5% = |$1,425,000 |   | |   |Sales/day = |$3,904. 11 |   | |The new COGS will be |$900,000 – 5% = |$855,000 |   | |   |COGS/day = |$2,342. 7 |   | |   |   |   |   | |Estimated AR if collection period lengthens by |5 |days: | |New AR = sales/day x collection period |   |   | |Sales/ day = |$3,904. 11 |   |   | |Old collection period |63. 27 |(from problem 10) |   | |New collection period |68. 27 |   |   | |New AR estimate= |$266,520. 5 |   |   | |   |   |   |   | |Estim ated inventory if conversion period lengthens by |7 |days: | |New Inv = COGS/day x conversion period |   |   | |COGS/day |$2,342. 47 |   |   | |Old conversion period |202. 78 |   |   | |New conversion period |209. 8 |   |   | |New Inv estimate= |$491,397. 26 |   |   | |   |   |   |   | |Estimated AP if payment period increased by |3 |day: | |New AP = sales/day x payment period |   |   | |COGS/day |$2,342. 47 |   |   | |Old payment period |68. 4 |   |   | |New payment period |71. 94 |   |   | |New AP estimate= |$168,527. 40 |   |   | |   |   |   |   | |2006 working capital = AR + Inventory – AP |   |   | |=$266,520. 55 + $491,397. 26 – $168,527. 40 |   |   | |=$589,390. 1 |   |   |   | |which is an increase of |$28,890. 41 |from problem 10. |   | 14. .Suppose Global Manufacturing is planning to change its credit policies next year. It anticipates that 10 percent of each month’s sales wil l be for cash; two thirds of each month’s receivables will be collected in the following month, and one-third will be collected two months following their sale. Assuming the Global’s sales forecast in Table 10. 5 remains the same and the expected cash outflows in Table 10. 6 remain the same, determine Global’s revised cash budget. Nov. Dec. Jan. Feb. Mar. Apr.Sales  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   $80,000  Ã‚   $100,000  Ã‚  Ã‚  Ã‚   $ 30,000  Ã‚   $   40,000  Ã‚  Ã‚  Ã‚   $ 50,000  Ã‚  Ã‚  Ã‚   $ 60,000   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Cash (10%)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   3,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   4,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   5,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   6,000   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   1 Month Later (2/3)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   60,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   18,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   24,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   30,000 [pic][pic][pic][pic]  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   2 Months Later (1/3)  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   24,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   30,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   9,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   12,000   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Total Cash Receipts  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   $ 87,000  Ã‚   $   52,000  Ã‚  Ã‚  Ã‚   $ 38,000  Ã‚  Ã‚  Ã‚   $ 48,000 [pic][pic][pic][pic]  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Less: Total Cash Payments  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   60,000  Ã‚  Ã‚  Ã‚   127,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   44,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   40,000   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Net Cash Flow  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   $ 27,000  Ã‚   $ –75,000  Ã‚  Ã‚  Ã‚   $ –6,000  Ã‚  Ã‚  Ã‚   $   8,000 [pic][pic][pic][pic]  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Beginning Cash Balance  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   25,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   52,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   25,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   25,000   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Cumulative Cash Balance  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã ‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   $ 52,000  Ã‚   $ –23,000  Ã‚  Ã‚  Ã‚   $ 19,000  Ã‚  Ã‚  Ã‚   $ 33,000Monthly Loan  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚      (or repayment) 0  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   48,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   6,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   –8,000   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Cumulative Loan Balance  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   0  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   48,000  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   54,000  Ã‚  Ã‚  Ã‚      46,000   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Ending Cash Balance  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚