What financial statements would natalie need in order to

Reference no: EM13602011

After investigating the different forms of business organization, Natalie Koebel decides to operate her business as a corporation, Cookie Creations Inc., and she begins the process of getting her business running.

While at a trade show, Natalie is introduced to Gerry Richards, operations manager of "Biscuits," a national food retailer. After much discussion, Gerry asks Natalie to consider being Biscuits' major supplier of oatmeal chocolate chip cookies. He provides Natalie with the most recent copy of the financial statements of Biscuits. He expects that Natalie will need to supply Biscuits' Watertown warehouse with approximately 1,500 dozen cookies a week. Natalie is to send Biscuits a monthly invoice, and she will be paid approximately 30 days from the date the invoice is received in Biscuits' Chicago office.

Natalie is thrilled with the offer. However, she has recently read in the newspaper that Biscuits has a reputation for selling cookies and donuts with high amounts of sugar and fat, and as a result, consumer demand for the company's products has decreased.
Instructions
Natalie has several questions. Answer the following questions for Natalie.

(a)What type of information does each financial statement provide?

(b)What financial statements would Natalie need in order to evaluate whether Biscuits will have enough cash to meet its current liabilities? Explain what to look for.

(c)What financial statements would Natalie need in order to evaluate whether Biscuits will be able to survive over a long period of time? Explain what to look for.

(d)What financial statement would Natalie need in order to evaluate Biscuits' profitability? Explain what to look for.

(e)Where can Natalie find out whether Biscuits has outstanding debt? How can Natalie determine whether Biscuits would be able to meet its interest and debt payments on any debts it has?

(f)How could Natalie determine whether Biscuits pays a dividend?

(g)In deciding whether to go ahead with this opportunity, are there other areas of concern that Natalie should be aware of?

Reference no: EM13602011

Questions Cloud

Over the last year 1400 injections were administered at a : over the last year 1400 injections were administered at a clinic. in five of these instances the incorrect dose was

Prepare the quarterly income statements showing income from : johnson products inc. has three regional division organized as profit centers. the chief executive officer ceo

Ortiz companys sales budget projects unit sales of part : ortiz companys sales budget projects unit sales of part 198z of 10300 units in jaunary 11 600 units in february and

The velocity of the system changes from 127 fts to 55 fts : a closed system of mass 6lbm undergoes a process in which there is a heat transfer of 245 ft-lbf from the system to

What financial statements would natalie need in order to : after investigating the different forms of business organization natalie koebel decides to operate her business as a

Prepare the following variance analyses for both chocolate : belgian chocolate company makes dark chocolate and light chocolate. bath products require cocoa and sugar. the

Lee and levi law firm uses job-order costing to accumulate : lee and levi law firm uses job-order costing to accumulate costs chargeable to each client. it has two departments the

What is the increase in internal energy in ft-lbf taking : 1.7 lbm object falling at 162 fts enters a viscous liquid and is essentially brought to rest before it strikes the

Ending inventory may not equal the cost of good available : anthony company uses a perpetual inventory system. it entered into the following purchases and sales transacti? anthony

User Account

All Pages