Running Head: DURANGO FIRM ANALYSIS 1
DURANGO FIRM ANALYSIS
Britania Veasey
Dr Bryan Womack
ACC 599 Graduate Accounting Capstone
December 13, 2015
, DURANGO FIRM ANALYSIS 2
Financial management and accounting knowledge and skills
Financial management and accounting knowledge and skills are used by various roles to
the company’s success and stability over the next five (5) years. Proper financial management
knowledge and skills will enable the financial manager to make the correct investment decisions.
Having the right knowledge the financial manager will be able to determine the most profitable
investment that the company should undertake for the next five years. The manager will utilize
the capital budgeting skills to allocate the available funds among the projects which will enable
the firm increase their revenues by 10%.
Financial management skills will also enable the manager to make financing decisions.
These include the sources of the funds for financing the project. In addition the manager will be
able to decide the proportion of debt to equity that will be used to finance the projects of the
firm. The knowledge and skill will enable the manager to determine the risk involved in
financing the projects using debt. Use of debts has high risks and the attitude of the manager
towards risk will help in deciding whether to take a project with risks and high returns or
undertake a lowly risked project which has low returns (Brigham & Houston, 2008).
Financial management skills enable the manager to make decisions regarding the
earnings division. It is the duty of the financial manager to advise the management on the
proportion to be distributed to the stakeholders. When making this decision, the financial
manager is guided by the dividend policy which determines the dividend payout ratio. The
amount that is not distributed to the shareholders is retained to finance the operations of the
organization. The Durango manager will therefore require financial management knowledge to
DURANGO FIRM ANALYSIS
Britania Veasey
Dr Bryan Womack
ACC 599 Graduate Accounting Capstone
December 13, 2015
, DURANGO FIRM ANALYSIS 2
Financial management and accounting knowledge and skills
Financial management and accounting knowledge and skills are used by various roles to
the company’s success and stability over the next five (5) years. Proper financial management
knowledge and skills will enable the financial manager to make the correct investment decisions.
Having the right knowledge the financial manager will be able to determine the most profitable
investment that the company should undertake for the next five years. The manager will utilize
the capital budgeting skills to allocate the available funds among the projects which will enable
the firm increase their revenues by 10%.
Financial management skills will also enable the manager to make financing decisions.
These include the sources of the funds for financing the project. In addition the manager will be
able to decide the proportion of debt to equity that will be used to finance the projects of the
firm. The knowledge and skill will enable the manager to determine the risk involved in
financing the projects using debt. Use of debts has high risks and the attitude of the manager
towards risk will help in deciding whether to take a project with risks and high returns or
undertake a lowly risked project which has low returns (Brigham & Houston, 2008).
Financial management skills enable the manager to make decisions regarding the
earnings division. It is the duty of the financial manager to advise the management on the
proportion to be distributed to the stakeholders. When making this decision, the financial
manager is guided by the dividend policy which determines the dividend payout ratio. The
amount that is not distributed to the shareholders is retained to finance the operations of the
organization. The Durango manager will therefore require financial management knowledge to
