Nygaard Jewelers Discussion Questions

1. Complete a three year financial analysis of Nygaard Jewelers including cash flow statements and ratio analysis for each year and discuss your findings.
2. Identify critical non-quantitative issues that should be considered in the decision process.
3. What risk factors should Bob be most concerned about regarding his decision?
4. Identify possible ethical or values-based issues that could impact any decision.
5. What should Bob and Bonnie do?

Nygaard Jewelers Balance Sheet For the Years Ending June 30, 20x1, 20x2, 20x3 and 20x4 20x1 20x2 20x3 20x4 $-4.824 7,886 186,450 189,512 $433 6.100 188,237 194,770 $-2,130 5,000 111,455 114,325 $9,657 4,368 99,351 113,376 Current Assets Cash Accounts Receivable Inventory Total Current Assets Long-Term Assets Equipment Less Accumulated Depreciation Equipment (net) Other Assets Total Long-Term Assets 139,497 150,790 149,332 152,942 -63,592 75,905 -82,639 68,151 -101,311 -118,049 48,021 34,893 1,458 1.458 49,479 36,351 75,905 68,151 Total Assets $265,417 $262,921 $163,804 $149,727 $151,743 $140,000 $140,000 $141,328 Current Liabilities Accounts Payable Long-Term Liabilities Loans from Shareholders Notes Payable Total Long-Term Liabilities 19.471 206,377 225,848 18.200 200,846 219,046 16,200 133,436 149,636 44.177 70,684 114,861 377,591 359,046 289,636 256,189 Total Liabilities Common Equity Common Stock Retained Earnings* Total Equity 1,000 -113,174 - 112,174 1.000 -97,125 -96,125 1.000 1.000 -126,832 -107,462 -125,832 -106,462 Total Liabilities and Equity $265,417 $262,921 $163,804 $149,727 *Prior period adjustments made to balance in retained earnings -6,417 1.669 Nygaard Jewelers Balance Sheet For the Years Ending June 30, 20x1, 20x2, 20x3 and 20x4 20x1 20x2 20x3 20x4 $-4.824 7,886 186,450 189,512 $433 6.100 188,237 194,770 $-2,130 5,000 111,455 114,325 $9,657 4,368 99,351 113,376 Current Assets Cash Accounts Receivable Inventory Total Current Assets Long-Term Assets Equipment Less Accumulated Depreciation Equipment (net) Other Assets Total Long-Term Assets 139,497 150,790 149,332 152,942 -63,592 75,905 -82,639 68,151 -101,311 -118,049 48,021 34,893 1,458 1.458 49,479 36,351 75,905 68,151 Total Assets $265,417 $262,921 $163,804 $149,727 $151,743 $140,000 $140,000 $141,328 Current Liabilities Accounts Payable Long-Term Liabilities Loans from Shareholders Notes Payable Total Long-Term Liabilities 19.471 206,377 225,848 18.200 200,846 219,046 16,200 133,436 149,636 44.177 70,684 114,861 377,591 359,046 289,636 256,189 Total Liabilities Common Equity Common Stock Retained Earnings* Total Equity 1,000 -113,174 - 112,174 1.000 -97,125 -96,125 1.000 1.000 -126,832 -107,462 -125,832 -106,462 Total Liabilities and Equity $265,417 $262,921 $163,804 $149,727 *Prior period adjustments made to balance in retained earnings -6,417 1.669