Lemonade Stand Season Three Written Report

1417 WordsMar 11, 20126 Pages
Lemonade Stand Season Three Written Report BUS 599 – Introduction to Quantitative Principles Instructor Lee Meadows August 8, 2011 Lemonade Stand Season Three Written Report In the lemonade stand business the income statement for season three reflects revenue, expenses, and the net profit for the season, which consisted of six days. Net income increased by 13.1% and revenue increased by 11.36%. I wanted to make the season a little more interesting so I decided to purchase more equipment to see if there was a difference in the operation of the stand. A comparison can also be seen and made between all three seasons that the stand operated. This report is essential in enabling important, informed business decisions. This report will inform the reader of balance sheet, income statement, and ratio information, as well as economic analysis for the lemonade stand business for three seasons of operation. The income statement describes the stand’s revenues and expenses along with the resulting net income over a six-day period due to earnings activities (Brownfield, 2007). This statement reflects the stand’s net profit of $172.55. The revenue generated from sales was $225.40, while the expenses for equipment and supplies were $52.85. The owners of the business can see rather quickly that sales and profits in terms of dollars were up for season three. They can attribute at least a portion of the increase to the weather, since they experienced more sunny days than in the previous two seasons combined. They can also see the actual profit margin compared to the previous seasons from the ratio numbers increased. The profit margin percentage increased from 75.39 % to 76.55 % in season three. This tells the owners that the business ran more efficiently in season three. Profit margin (net income divided by revenue) can then be calculated and the owners can see

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