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Comparison of working capital management patterns and the implementation in PT MERCK Indonesia

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Most users of financial statements, as well as the company are interested in a measure of the financial performance. Liquidity determines a company capability to meet its short-term liabilities and the operating needs of the business. Working capital is the life-blood of business. It is the short-term operating assets and liabilities of the company. Consisting of cash and cash equivalent, account receivable, inventories and account payable. Most business is conducted on credit, and most business maintains inventories of materials or merchandise. These elements of working capital interact on a daily basis as merchandise is bought and sold on credit, recivable are collected from customer, and bills are paid to suppliers. The main problem is how to improve working capital management in pt. Merck by means of credit management improvement and inventory management improvement. The research employs key financial ratios to measure and evaluate inventory management and credit management including leverage, liquidity, efficiency, and profitability since 1999. To maximize the financial performance company need to improve the collection of the receivable and manage the inventory level. Company's pattern on the terms on sales is 45 days, 90 days for inventory. Since 1999 companies could not achieved this pattern. It can be concluded that to achieve company's pattern on the inventory management and credit management, company's can use financial planning model for inventory and credit management for the collection.rn

rnNotes: cd is not available

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Availability

M00025

(wh)

Available

Detail Information

Series Title

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Call Number

25

Publisher

: Swiss German University., 2003

Collation

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Language

English

ISBN/ISSN

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Classification

NONE

Content Type

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Media Type

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Carrier Type

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Edition

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Subject(s)

MBA

Specific Detail Info

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