{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Fin 610 Case 2 - CASE 2 1 Quickfixs sales have been...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
CASE 2 1. Quickfix’s sales have been increasing significantly over the past 4 years. The increase in sales each year is around 10% and even more. The increase in sales has also increased the gross profit each year. However, in the year 2003, increase in Admin and Selling exp is significantly higher. This has resulted in the lower EBIT in the year 2003, which in turn resulted in the net loss. So, compared with sales, the earning growth has not been stable because of the interest on long term loans and the admin and selling expenses. 2. Juan should refer to the Balance Sheets of Quickfix Autoparts, and he should construct the Balance Sheets to develop a fair assessment of the firms’ financial condition, as the balance sheet is a summary of the value of all assets, liabilities and ownership equity for the company at the end of its financial year. It is a snapshot of a company’s financial condition on a given date. Thus, Juan should refer to and construct the Balance Sheet to develop a fair assessment of the firm’s financial condition. Another significant statement that Juan should prepare is the statement of cash flows. The net operating income includes the non cash expenses like depreciation which did not take up any cash. So in order to get the true picture of the company’s cash position, Juan should prepare and carefully analyze the cash flow statement of the company, for all those years.
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern