Mercury Shoes Week 7

Mercury Shoes Week 7 Introduction

This analyses and discusses the impact of the ethical situation and the implementation of innovation of technology at the Mercury Shoes

Analysis and discussion

Business impacts coming from ethical situation and the implementation of innovation of technology should be seen on the basis of evidence presented . Their effects could be best seen in the financial statements particularly in the income statement , which measures the performance of the company for a given period

A summary of the company 's performance shows the following

Quarter

, year 1Q , 2003 627 .96 ( 9 .66

2Q 622 .44 ( 2 .10

3Q 683 .89

31 .07

4Q 725 .01 2 ,659 .30 32 .04

1Q , 2004 654 .37 ( 21 .34

2Q 683 .48 ( 1 .05

3Q 726 .99

12 .07

4Q 764 .90 2 ,829 .74 18 .06

1Q , 2005 695 .67 ( 12 .79

2Q 675 .54 ( 12 .70

3Q 727 .21

22 .10

4Q 763 .07 2 ,861 .49 30 .66

1Q , 2006 644 .32 ( 54 .02

2Q 653 .71 ( 50 .60

3Q 722 .04 ( 27 .36

4Q 750 .56 2 ,770 .63 ( 16 .84 with net earnings appearing as negative figure for the last fourth quarter of 2006 . Further analysis revealed comparing profitability per quarters for the past the years 2003 to 2005 it was observed that it is only during third and fourth quarters that net earnings are positive implying there is seasonability of the products

As to liquidity , the company may be doing well but this will eventually deteriorate if losses or low profitability will continue The high debt to equity ratio of more than five is to one (5 :1 ) from 2003 to 2005 and above ten is to one (10 :1 ) fro 2006 the company indicates that the company is highly risk and if losses continued bankruptcy is not a very far event to happen . See Appendix A for details

If we consider the effect to be measured in 2006 , the ethical situation and the implantation of the innovation and technology will not be good to the company . It is given that Mercury Shoes is a very well known and well-respected athletic shoe company . The company has been running into some trouble and with this new product hoping to turn things around . Right now Mercury has been turning everyone away in all of the major markets and in the process margins are dropping as well If the results of the 2006 would be the figures and ratios that would be used to show the effect the technology , there seems to be not basis of making the business profitable

Although they may have an efficient manufacturing process with innovative technology with state of the art facilities for producing a new product , results must show proof of better performance

Its problems of low factory utilization and insufficient use of corporate resources could indicate only two things its product is not selling well against competitors or the industry is no longer profitable . Profits not improvement for the...