Assessing the Goal of Sports Products, Inc. Fin/419 What should the management of Sports Products, Inc. pursue as its twist goal? It come outs that the proper goal to meet is to maximize shareholders riches, which heedful by the market charge of the hards acquit. When the investors expected hard currency lead the cash flow is determined by the firms stock price and is generated overtime. As a financial manager it is his or her personal line of credit sector to monitor the actions that they expect will patron increase the firms forthcoming cash flows. An interesting thing to record is shareholders of a smart set can non pay them introductory before, employees, suppliers, creditors, the government, and stakeholders they will contract nothing. Shareholders take on many risks when travel rapidly a firm and if the firm is not managed properly to maximize the shareholders riches, the investors will confuse no lust to accept the risks for that business to succee d. Does the firm appear to have an federal force conundrum? Reading the case study, yes the firm does appear to have an agency problem. The firms stock has declined $2 per share over the closing mantel nine months but the firms profits have been rising. Shareholders normally produce what is called cash dividends and from the text the firm has never paid a dividend in 20 years.
From what is written in the first paragraph, shareholders wealth is reducing during this time, and this envisions that there is an agency problem. With the management team their actions show that befoulment controls will show a prof it maximization try, which means the manage! rs are trying to maximize his or her salary, to begin with of the attempt to maximize shareholders wealth, the stock price. Evaluate the firms approach to contamination control. In reading the text we do not fuck if the action of dumping pollutants in the adjacent stream was aforethought(ip) or not. Though the firm is being sued by the accede and federal environmental officials for this action, there is no proving the firm was doing this. If the firm were...If you extremity to get a full essay, order it on our website: OrderCustomPaper.com
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