BSM 100 Lecture Notes - Lecture 10: Debt Ratio, Target Market, Accounts Receivable

• School: Ryerson University
• Department: Business Essentials
• Course: BSM 100
• Professor: Ranjita Singh

Document Summary

In order to understand the attractiveness of an industry: you must look at 5 forces. Number of competitors (very similar to your product) Who is going to give you medium (equipment, raw material, production, platform etc. ) to develop your product/service. The bargaining power = must determine if this power is high, moderate, or weak. If a lot of bargaining power = you must do exactly what the suppliers want you to do. Not your direct competitors but could become your competitors. In a similar industry but could come into yours and take over. Do not need to say high, moderate, weak . Target market (geography, age, and how you will address them) Current ratio = current assets / current liabilities. Inventory turnover = cost of goods sold / inventory. 230, 000 / 85,000 = (reduce fractions = 230/85) Average collection period = accounts receivable / (sales / 365) 125,000 / (450,000 / 365 days) = 101 days.