Key Assumptions

1.The attached spreadsheet contains financial data for Stryker. It also contains a standard 5 year forecast. Use the forecast to inform your answers. Make changes to model as you deem appropriate. Use only the tab titled stryker model

2.Provide your answers in a word document.

3.Stryker sells medical devices, that require PCB's. It is evaluating whether it should insource the production of circuit boards *PCB's). To insource, they would need to build a manufacturing facility, and sever ties with their suppliers.The current spreadsheet describes their base financial model if they continue their current strategy. Make sure you understand and describe this scenario fully

4.If Stryker decides to insource, that will have multiple impacts on their financial situation. They would take a long term loan to build or buy a PCB factory. They can borrow money from a bank at 8%.

5.All items on the IS/BS are in 1,000s

6.If Stryker builds a PCB manufacturing plant, assume they can build it immediately. This is unrealistic, but will simplify the problem

What is Strykers current financial situation. From an Income Statement and Balance Sheet point of view.

What are the pros and cons of the current plan vs. insourcing the production of PCBs. Provide thought and depth to this answer

What are the key financial metrics you would look at to compare the current plan with the insourcing plan?

Insourcing will require several financial changes. What are those financial changes? And what are reasonable assumptions as to how much they will change?

Assuming it will cost $6Billion to build a new PCB factory, what are the financials of this plan, and how does it compare with the current outsourcing plan? How does your answer change if that changes to $1B, or $10B?