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Analysis of Walmart's Financial Performance in 2018

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Added on  2020-11-10

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This article analyzes Walmart's financial performance in 2018, including COGS, sales, gross profit margin, net profit margin, ROA, and ROI. It compares Walmart's performance with that of its rival Amazon and provides possible explanations for the changes in performance.

Analysis of Walmart's Financial Performance in 2018

   Added on 2020-11-10

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Task 1Part 1) (U)(U)Price VQuantity VActual QuantityActual Price460,000DIRECT MATERIAL VARIANCE (VND)Budget PriceBudget PriceActual QuantityBudget Quantity 460,00058,00062,0001,840,000,00028,520,000,00026,680,000,000400,00023,200,000,00058,0003,480,000,000Price variance: (1,840,000,000 / 26,680,000,000) *100% = 6.9%Quantity variance:(1,840,000,000 / 26,680,000,000) * 100% = 15%(U)(U)Rate V620,000Budget Rate50,000Budget Rate31,000,000,00055,00034,100,000,00050,000620,000Actual HourActual RateActual Hour3,100,000,000600,000Efficiency VStandard HourDIRECT LABOR VARIANCE (VND)30,000,000,0001,000,000,000Rate variance:(3,100,000,000 / 31,000,000,000) * 100% = 10%Efficiency variance:(1,000,000,000 / 30,000,000,000) * 100% = 3.3%(U)(U)6,800,000,000200,00034,00034,0008,160,000,0001,360,000,000240,000Budget QuantityStandard ProfitSALE VARIANCE300,000Actual QuantityQ.VBudget Price50,000,000,00010,000,000,00060,000,000,000200,000Actual PriceActual QuantityPrice V200,000250,000Actual QuantityStandard ProfitPrice variance:(10,000,000,000 / 60,000,000,000) * 100%= 16.67%1
Analysis of Walmart's Financial Performance in 2018_1
Quantity variance:(1,360,000,000 / 8,160,000,000) * 100% = 16.67%FavorableAdverse8,160,000,00010,000,000,0001,360,000,000(3,200,000,000)1,840,000,0003,480,000,0003,100,000,0001,000,000,000(12,620,000,000)4,000,000,0005,000,000,000(21,620,000,000)Less: Direct Material VLess: Actual SellingLess: Actual AdminstrationActual ProfitOPERATING STATEMENT OF HOANG TUAN COMPANY, 2018.Price VQuantity VLess: Direct Labor VRate VEfficiency VBudget Gross Profit Less: Sales VariancePrice VarianceQuantity VarianceActual Sales - Bg COGS50,000,000,00028,520,000,00034,100,000,000(62,620,000,000)(12,620,000,000)4,000,000,0005,000,000,000(21,620,000,000)Less: Actual Selling ExpenseLess: Actual Administration ExpenseActual ProfitBudget Gross Profit Less: COGSMaterialLaborGross ProfitINCOME STATEMENTPart 2) Possible explanation and Recommendations:The sudden increase in material usage in 2018 is about 15% of predicted budget may possibly come from the following problems: use of unskilled labor (for example, workers do not have skills to use materials to make 2
Analysis of Walmart's Financial Performance in 2018_2
clothes, cause wastes), and purchase of materials of lower quality than the standard. To overcome the first problem, the Hoang Tuan company should spend 2 – 3 weeks retaining those workers to have more work skills.As for the second issue, HT can buy higher quality fabrics and fabrics to avoid broken materials in the process, torn, stain. The responsibility for material quantity variance is production manager because production manager ensure that manufacturing processes run reliability and efficiently including determining quality control standards and workers. Next is direct labor variance, the labor rate has reached 10%. The common reason of unfavorable labor rate variance is inappropriate use of labor. Specifically, if the tasks that are not so complicated are assigned to very experienced workers, unfavorable labor rate variance may be the result. Because highly experienced workers are paid high wages. This responsibility is production manager because production manager must ensure that workers do the right things, avoid the inaccurate use and disadvantages for the company.From the table, the price has decreased by 16.67%, due to fierce competition from other suppliers and poor quality compared to the standard. For those problems, Hoang Tan should create new, creative, branded products, or superior marketing and customer care regimes; buying and managing quality of materials to overcome competitors and earn profits. Similarly, this trend also occurs in numbers, down 16.67%. This can happen when not training employees in the production line can 3
Analysis of Walmart's Financial Performance in 2018_3

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