The Impact of Management of Account Receivable and Financial Performance of Manufacturing Firm.

ABSTRACT

The broad objective of this study is to examine management of account receivable and financial performance of manufacturing firm. To achieve this objective the variables used in this study were summarized and analyzed into various components using. Coefficient of multiple determinations”, assisted by the Statistical Package for Social Sciences (SPSS) in order to test the impact of  account receivable and financial performance of manufacturing firm . Base on the finding we concluded that manufacturing firms should ensure that they have a very effective accounts receivable management as this will help improve their financial performance. From the findings discussed above the study recommends that management of manufacturing firms should put in place effective management of accounts receivables. The firms should put in place a sound credit policy that ensures proper debt collection procedures since it’s important in improving efficiency in receivables management hence the performance of firms. The firms should adopt a shorter receivable collection period since a longer period delays cash inflows, impairs the firm’s liquidity position and increases the chances of bad debt losses. Therefore, base on the findings we made recommendation that management should pay attention to the ongoing calibration between liquidity and performance in order to meet the operational and expansion process requirements as well as to achieve the aspirations of the shareholders through enhancing their wealth. We suggest that a comparative study can be carried out to establish whether liquidity affects corporate performance of other sectors or otherwise.

TABLE OF CONTENTS

Cover page 

Title 

Declaration………………………………………………………………………………………………………………………………iii

Certification…………………………………………………………………………………………………………………………….iv

Dedication……………………………………………………………………………………………………………………………….v

Acknowledgement………………………………………………………………………………………………………………….iv

Table of Contents………………………………………………………………………………………………………………

Abstract…………………………………………………………………………………………………………………………………

CHAPTER ONE: INTRODUCTION              PAGES

1.1Background of the study 1-3

1.2Statement of the problem  4-5

1.3Research question6

1.4Objective of the study           6

1.5Hypothesis of  the study7

1.6Justification for the study7-10

1.7Scope of the Study8

1.8Operational definition of terms8

CHAPTER TWO: LITERATURE REVIEW

2.1Conceptual Review           9-30

2.1.1      Conceptual Framework31

2.2   Empirical Review32-34

2.3 Theoretical Review 34-40

2.3.1Theoretical Framework 41-42

CHAPTER THREE: METHODOLOGY

3.0    Introduction 43

3.1 Area of Study 43

3.2 Research Design 43

3.3 Population, Sample size and Sampling Techniques 43-44

3.4 Source of Data and Data Collection Method44

3.5 Research Instruments44

3.5.1 Reliability of Instrument and Validity of Instrument 45

3.6 Re-statement of Hypothesis 45

3.7 Method of Data Analysis 45-46

CHAPTER FOUR: DATA PRESENTATION, ANALYSIS AND DISCUSSION OF FINDINGS 

4.1      Data Presentation and Analysis 47-65

4.2      Test of Hypothesis 66-69

4.3     Discussion of Findings  69

CHAPTER FIVE: SUMMARY, CONCLUSION, AND RECOMMENDATION 

5.1     Summary70

5.2     Conclusion 71

5.3      Recommendations71

5.4       Contribution to Knowledge 72

5.5      Limitation of the Study 72

5.6    Suggestion for Further Study72

           Reference             73-77

          Appendices