Monsanto Executive Summary

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Management Efficiency is determined by looking at six ratios. All key ratios to evaluate management efficiency for Monsanto and its competitors were obtained from Morningstar. One ratio to look at to determine management efficiency is accounts receivable turnover which is calculated by dividing net sales for year by accounts receivable. The accounts receivable turnover ratio indicates how many times on average accounts receivables are collected during a year. The ratio evaluates the ability of a company to efficiently issue credit to its customers and collected funds from them in a timely manner. High number are good so A/R Turnover graph in Appendix (2) shows that Monsanto had a lower turnover in 2012 and its highest turnover was in 2014 but compared to Dow and DuPont, Monsanto did not do as …show more content…

The average collection period is also referred to as the ratio of days to sales outstanding. It is the average numbers of days it takes a company to collect its accounts receivable. In other words, this financial ratio is the average number of days required to convert receivable into cash. The lower number is the better. Monsanto did its best at collecting during 2014 and its worst in 2012 but compared to Dow it didn’t do as well. Shown in Appendix (3), Monsanto still collected faster than DuPont and Syngenta. The inventory turnover ratio tells the number of times inventory was sold. It tells how efficient the company is at managing inventory. Inventory turnover is determined by dividing net sales by average inventory. A higher inventory turnover ratio is preferred, as it indicates that more sales are being generated given a certain amount of inventory. Monsanto’s highest turnover ratio, as seen in Appendix (4), was in 2013 and its lowest was in 2015. Monsanto performed better than Dupont and Syngenta but not as well as

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