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Proposed Alternative Action #1: Order the raw materials on Wednesday to avoid working overtime.
Strengths of Action #1: The raw materials would be here by late Wednesday. This gives the employees the opportunity to work on the order all day Thursday and Friday. The order will take five solid days of work without overtime to produce the order. Therefore, since the following Monday is a holiday the order would be ready by the following Thursday. This would mean we would have produced the order and be able to receive payment for the order a day early without having incurred any overtime.
Weaknesses of Action #1: If the materials are purchased on Wednesday, we would have to write a check. That means the cash flow from operating activities for this year will be much lower, which our stockholders won’t like. Also, our acid test ratio will go down from 1.01:1 to .90:1, so our creditors may be upset.
Proposed Alternative Action #2: Order the raw materials on the following Tuesday......
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Title: Accounting Case-Alternatives With Strengths And Weaknesses
Approximate Word Count: 878
Approximate Pages: 4 (250 words per double-spaced page)
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Accounting Case-Alternatives With Strengths And Weaknesses
Accounting Case-Alternatives With Strengths And Weaknesses. Proposed Alternative
Action #1: Order the raw materials on Wednesday to avoid working overtime. ... ...
