Bigger Isn\'t Always Better! Andre Pires opened his automobile parts store, Quic

Question

Bigger Isn't Always Better! Andre Pires opened his automobile parts store, Quickfix Auto Parts, five years ago, in a mid-sized city located in the mid-western region of the United States. Having worked for an automobile dealership. first as a technician, and later as the parts department manager, for over 15 years, Andre had learned the many nuances of the fiercely competitive automobile servicing business. He had developed many con dealers and service technicians, which came in really handy when establishing his own retail store. Business had picked up significantly well over the years, and as a result, Andre had more than doubled his store size by the third year of operations. The industry and local forecasts for the next few years were very good and Andre was confident that his sales would keep growing at or above recent levels. tacts with However, Andre had used up most of his available funds in expanding the business and was well aware that future growth would have to be funded with external sources of funds. What was worrying

Explanation / Answer

2) Juan Should refer to Balance Sheet and Income Statement Juan should construct Cash flow Statement 6) Item Formula Calculation Ratio Liquidity Current Asset/Current Liabilities 668503/176421 3.789248 Asset Utilisation Turnover/Total Assets 1013376/968503 1.046332 Long term Solvency Total Debt/Equity 623421/345082 1.806588 Profitability Net Profit/Sales (102)/1013376 -0.0001 7) Shortterm loan of 25000 may be granted as the liquidity position of the company is fairly safe. 9) Limitation of Financial Statement Analysis a) Accounting misstatements b) Book Values are measured on historical cost basis for Non-Monetary Assets

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