Chestnut & Cedar Stock Report - Inventory Categories

Balance Sheet Analysis

- Leverage and financial
   strength affect share value

- Liquidity concerns can
   decimate a business

- Cash is critical, to a point
    * Window Dressing
    * Cash Gap
    * Cash per Share
    * Burn Rate

- Marketable Securities

- Receivables are interwoven
    with cash flow
    * Past Dues and Write-offs
    * Receivables turnover ratios
    * Securitizations

- Inventory - focus on the
   profit margins
    * Perpetual vs. Periodic
       Inventory
    * Inventory Accounting
       Calculation
    * Inventory Costing Methods
    * Lower of Cost of Market
    * Inventory Categories
    * Inventory Turnover Ratios

- Fixed assets are necessary in
   order to be a world class
   company

- Liabilities with equity attributes
   are enriching

- Emphasizing debt net of cash
   can be misleading

- Book value is a tool to
    properly evaluate a stock

- Off-balance sheet assets and
   liabilities are legal

Inventory Categories

Companies categorize their inventory as, raw materials, work in process, and finished goods. The critical issue that is usually not disclosed by the accountants is: how much additional material and work is needed to convert the entire inventory to finished products available for sale.

Click here for information on:
-Focus on the Profit Margins
-Perpetual vs. Periodic Inventory
-Inventory Accounting Calculation
-Inventory Costing Methods
-Lower of Cost or Market
-Inventory Turnover Ratios