need to find ways to cut operating costs to make a profit.

US Inc. Last Year Actual This Year Forecast Assets Cash Receivables Inventory Fixed Assets Acc. Depreciation Other assets 300,000 200,000 100,000 500,000 (420,000) 25,000 705,000 100,000 350,000 200,000 all inventory will tumover within a year 500,000 (480,000) 25,000 695,000 Liabilities Accounts payable Other current liabilties Notes payable 265,000 300,000 200,000 765,000 300,000 300,000 200.000 800,000 Owner's Equity Common stock Retained eamings 1,000,000 (1,060,000) (60,000) 1,000,000 (1.105,000 (105,000) 705,000 695.000 Liabilities + OE US Inc Sales COGS Gross margin General & Administrative Sales & marketing expense Research & Development Operating margin Interest Net income This Year Forecast 100,000 Price = $50 per unit 65,000 35,000 25,000 25,000 10,000 (25,000) 20,000 (45,000) US Inc. uses the calendar year for its fiscal year. It is January and your Board of Directors (BOD) has called a special meeting to discuss the plan for this year. Shareholders are demanding company become profitable in this year! Competition sells same product for $60 per unit, customers and independent testing says their product quality is superior to US Inc. Competition's gross margin is 55% Positions CFO - Cut operating costs enough to make a profit