Financial Analysis Task 5: Financial

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JET2 Task 5 Financial Analysis Susan Martinez JET 2 Task 5- Susan Martinez A1) Custom Snowboards desires funding to expand into Europe. The amount requested is a $1,000,000 loan. Over the past three years Custom Snowboards is a profitable company which has the potential for doing well with a European expansion. The horizontal analysis shows there has been an increase in net sales from years 12-13 by $209,300 (3.21%) and from years 13-14 by $128,800 (1.91%). The gross profits have increased from year 12-13 by $63,700 (3.21%) and from years 13-14 by $39,200 or 1.91%. The total operating expenses have also increased $94,200 or 5.45% from years 12-13 and by $82,200 or 4.51% from years 13-14. Many of the operational expenses have remained the same from year to year, such as web site…show more content…
The net sales also increased from year 14 to year 17 ending at $7,115,112. This showed to be very profitable with trend percentages at 103.7%. A2) There are certain risks a banker might be concerned with. Over the years the advertising expenses have increased from $243,000 to $255,600. The increase in advertising can be helping with increase in net sales which has also increased from 46,520,500 in year 12 to $6,858,600 in year 14. The interest income has decreased which may concern a banker looking to approve a loan. It would be good to invest the money in a more secure or profitable investments. Utilities and services have also increased from $238,000 to $260,000 in year 14. Contracts with utility companies can be re-negotiated. There is also depreciation of the equipment and furniture but this is normal depreciation values which are placed on all equipment regardless of performance. The operating income has increased but this is due to the increase in utilities, research, development, and

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