Question
DeLish Dish, a small, local restaurant here in Jersey City is doing well financially and is thinking about opening up another location in Hoboken next
DeLish Dish, a small, local restaurant here in Jersey City is doing well financially and is thinking about opening up another location in Hoboken next year. The owners have focused so much on cooking delicious food that they havent really kept up with their financial records. Since you come into the restaurant frequently, the owners know you are taking a corporate finance course and ask if you could help them out. Being a financial wizard, and nice person, you say you will give them your recommendation in exchange for a free meal.
Please use the following information to:
5a. Prepare a balance sheet.
5b. Prepare an income statement.
5c. Compute free cash flow (otherwise known as cash flow from assets). Last years current assets were $87,000 and current liabilities were $43,000. Last years net fixed assets were $245,000.
5d. Give your overall recommendation to whether or not they should open up a new shop next year.
DeLish Dish, LLC.
Mixed Financial Statement information
Cost of Goods Sold | 248,000 |
Cash | 43,000 |
Depreciation | 63,000 |
Interest Expense | 14,000 |
Selling and Administrative Expense | 60,000 |
Accounts payable | 34,000 |
Net Fixed Assets | 298,000 |
Sales | 570,000 |
Accounts Receivable | 26,000 |
Notes payable | 25,000 |
Inventory | 52,000 |
Long-term Debt | 140,000 |
(Adapted from Ross, Westerfield, and Jordan, 2016 Chapter 2 Minicase)
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