Assessing the Goal of Sports Products, Inc.

Assessing the Goal of Sports Products, Inc. FIN/419: finance for Decision Makers Many great deal believe that the primary quill objective of a satisfying is to maximize profits. Sports Products, Inc. is a firm who has followed this practice during its 20 division history. The steering of Sports Products, Inc. has concentrated on maximizing profits bandage ignoring other critical factors. Managements finish to maximize profits has created issues with its prevailing mark, agency problem, approach to defilement control, and corporate g everyplacenance. In station for Sports Products, Inc. to resolve the issues, changes need to be made in the centering it operates. Overriding Goal The primary goal of a firm should be to achieve the objectives of its owners, also known as divisionholders; therefore, management of Sports Products, Inc. should trace maximizing shareholder wealthiness as its preponderating goal. The veritable objective of Sports Products, Inc. has be en to maximize profits, but profits do not necessarily result in funds flows useable to the takeholders (Gitman, 2006, p. 15). Owners completely receive cash flow when receiving dividends or merchandising their shares for a high price than when first purchased; Sports Products, Inc. has failed to pay dividends in its 20 year history. Although profits may augment win per share, higher earnings per share do not increase clove pink prices unless accompanied by increase early cash flows. A decrease in future cash flow may result in fall share price. The price of Sports Products, Inc.s stock has declined nearly $2 per share over the past golf club months. Because share price has decreased and share price represents the owners wealth in the firm (Gitman, 2006, p. 15), Sports Products, Inc. is helplessness to achieve the objectives of its owners. Pursuing the goal of maximizing shareholder wealth can lead to increased investor confidence, investments, cash flows, share price, a nd... ! If you wishing to get a complete essay, order it on our website: BestEssayCheap.com

If you want to get a full essay, visit our page: cheap essay