Reference no: EM133247015

You have been hired in a commercial lawsuit by the defendant to analyze the plaintiff's lost profits damage claim. The plaintiff is claiming the equipment that it purchased from the defendant was faulty. The lawsuit says the problems with the equipment interfered with the plaintiff's operations, causing it to lose revenues for several months until the equipment problem was identified and fixed.

You have received the plaintiff's audited financial statements for the past several years and observe its annual revenues have been: $20.0 million (Year 20X1), $21.0 million (Year 20X2), $21.5 million (Year 20X3), $18.5 million (Year 20X4), and $21.0 million (Year 20X5). The alleged injury occurred at the beginning of 20X4. The plaintiff asserts that the financial statements prove that it lost revenues because of the equipment defect.

Required

Assuming the equipment actually had a problem, what would you likely do next to analyze whether the plaintiff suffered any economic losses caused by the equipment problem?