Describe Zach Industries\' overall financial condition? Research and describe a company currently in the news in similar financial condition, and compose a comparative analysis on what can be/should be done to improve the circumstances of both the fictional and real-world company. Support your answers with financial ratios and provide explanations. Solution Part A Use the preceding financial statements to complete the following table. Assume that the industry averages given in the table are applicable for both 2014 and 2015 Industry Average Actual 2014 Actual 2015 Currant Ratio 1.800 1.840 1.043 Quick Ratio 0.700 0.780 0.384 Inventory Turnover 2.500 2.590 2.330 Average Collection Period 37.500 36.500 57.031 Debt Ratio 0.650 0.670 0.613 Times interest earned ration 3.800 4.000 2.787 Gross Profit Margin 0.380 0.400 0.338 Net profit margin 0.035 0.036 0.041 Return on total assets 0.040 0.040 0.044 Return on common equity 0.095 0.080 0.113 Market/Book Ratio 1.100 1.200 1.300 Part B Analyze Zach Industries’ financial condition as it is related to (1) Liquidity: Zach Industries’ liquidity position has deteriorated from 2014 to 2015 and is inferior to the industry average. The firm may not be able to satisfy short-term obligations as they come due. (2) Activity: Zach Industries’ ability to convert assets into cash has deteriorated from 2014 to 2015. Examination into the cause of the 20.5-day increase in the average collection period is warranted. Inventory turnover has also decreased for the period under review and is fair compared to industry. The firm may be holding slightly excessive inventory. (3) Debt: Zach Industries’ long-term debt position has improved since 2014 and is below average. Zach Industries’ ability to service interest payments has deteriorated and is below industry. (4) Profitability: Although Zach Industries’ gross profit margin is below its industry average, indicating high cost of goods sold, the firm has a superior net profit margin in comparison to average. The firm has lower than average operating expenses. The firm has a superior return on investment and return on equity in comparison to the industry and shows an upward trend. (5) Market: Zach Industries’ increase in their market price relative to their book value per share indicates that the firm’s performance has been interpreted as more positive in 2006 than in 2005 and it is a little higher than the industry. Overall, the firm maintains superior profitability at the risk of illiquidity. Investigation into the management of accounts receivable and inventory is warranted..

1. DescribeFIVE possible reasons for the failure of a Total Quality Management (TQM)
programme within an organisation.
Solution
A number of common reasons for failure of Total Quality Management (TQM) programmes
exist including those given below:
Poor project management
The introduction of the TQM programme may have been poorly project managed. This may
have resulted in key stages being overlooked and/or ineffective communication of aims, etc. so
leading to programme failure.
A lack of impetus
The implementation of TQM in an organisation is a long-term process. There may have been
some sort of a 'tail-off' whereby after an initial burst of enthusiasm, management and workers
may have failed to maintain interest.
Lack of genuine buy-in by top management
Successful introduction of TQM requires the commitment and support of top management.
Programme failure may result where management is not totally convinced by the value of TQM
and/or only pays 'lip service' to its principles.
Cultural resistance
If TQM