Essay about Candela Corporation Case

775 Words May 8th, 2012 4 Pages
Candela Corporation Case
Desmond Steele
ACC/230
June 5, 2011
Axia College of University of Phoenix

Summary Analysis
2004
A $ 2,154,000 net loss was occurred by the Candela Corporation. The accruals method was used to calculate the figure. The non-cash expenses were added back into the statement in order to obtain the proper cash flows. Notional interest on stock warrants and discounted operations were the additions that are the most important. In respect to the important additions there are also important subtractions as well and those subtractions are the currency exchange rate difference and deferred taxes. The working capital analysis showed that there was a significant increase in the inventory, receivables, and tax payables.
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The working capital analysis showed that the company’s cash inflow were from deferred income, notes, sales of other assets, sale of inventory, tax refund, and a control on payroll costs. The company’s cash outflows were from receivables, restricted cash, warranty costs, and payment of payables. These things caused cash inflow, which made the figures of the operating activities positive. The difference from the year earlier is $ 18,726,000.
The company had an increase in the number of shares issue and after that the company had increase in lines of credit and payment of long-term debt. Because the company’s share issue inflow was bigger, that leads to an inflow of cash of $ 176,000. As it pertains to the investing activities, the purchase of fixed assets was $ 169,000 more than the year before and that caused an outflow with the investing activities. All activities were positive except for the investing activities. That gave the company an increase in their cash reserves because of the $ 12,156,000 of positive net cash flow.
2004
The Candela Corporation had a net profit of $ 8,119,000. The foreign exchange rate difference, discounted operations losses, a new provision for the discounted operations losses, and deferred taxes were the most important additions. The benefit on stock options was the most important subtractions. The working capital analysis showed that the

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