describe circumstances of the following case study

recommend which company to purchase.

Explain your approach to the problem, perform relevant calculations and analyses, and justify your recommendation.

Case Study:

You work in the mergers and acquisitions department of a large conglomerate who is looking to invest in a retail business.

Two companies, Fashion Forward and Dream Designs, are the final two options being considered.

recent availableincome statements and two years of balance sheetsfor each company -- see file attached -->

Income Statements Fashion Forward Dream Designs 12/31/2018 12/31/2018 Revenue Credit Sales Non-Credit Sales Total Revenue 2,000,000 500,000 2,500,000 4,320,000 1,080,000 5,400,000 Cost of Sales Gross Profit 1,400,000 1,100,000 3,250,000 2,150,000 Operating Expenses Research and Development Selling, General, and Administrative Total Operating Expenses 50,000 750,000 800,000 200,000 1,600,000 1,800,000 Earnings Before Interest and Taxes 300,000 350,000 (18,000) 282,000 (145,500) 136,500 (50,000) 300,000 (87,500) 212,500 Interest Expense Income Before Tax Income Tax Expense Net Income Fashion Forward 12/31/2018 Balance Sheets Fashion Forward Dream Designs 12/31/2017 12/31/2018 Dream Designs 12/31/2017 Current Assets Cash and Cash Equivalents Accounts Receivable Inventory Other Current Assets Total Current Assets Property, Plant and Equipment Goodwill Other Long-Term Assets Total Assets 950,000 200,000 112,000 35,000 1,297,000 635,000 750,000 65,000 2,747,000 980,000 150,000 105,000 50,000 1,285,000 700,000 750,000 70,000 2,805,000 1,710,000 250,000 200,000 120,500 2,280,500 850,000 1,150,000 100,750 4,381,250 1,705,000 275,000 215,000 100,000 2,295,000 900,000 1,150,000 105,000 4,450,000 Current Liabilities Accounts Payable Short-Term Debt Other Current Liabilities Total Current Liabilities Long-Term Debt Other Long-Term Liabilities Total Liabilities 545,000 25,000 600,000 1,170,000 75,000 100,000 1,345,000 535,000 510,000 1,045,000 75,000 1,120,000 845,750 50,000 730,000 1,625,750 120,500 155,000 1,901,250 875,000 60,000 740,000 1,675,000 130,000 165,000 1,970,000 Stockholders Equity Common Stock Preferred Stock Retained Earnings Total Stockholders Equity 500,000 150,000 752,000 1,402,000 775,000 294,500 615,500 1,685,000 749,500 390,000 1,340,500 2,480,000 942,750 409,250 1,128,000 2,480,000 2,747,000 - 2,805,000 - 4,381,250 - 4,450,000 - Total Liabilities and Stockholders Equity