Scenario:

Imagine you are a small business consultant in Auburn, NE and your business is slow. You just contracted with TANSTAAFL Corporation in beautiful downtown Peru, NE. You just accepted an offer from TANSTAAFL Corporation to pay you $60,000 a year to be the CEO for the next two years. You will be paid directly from the Founder?s private funds and your salary is not to be included in the financial statements and projections. The Founder is a private individual who is unwilling to share the balance sheet with you because he doesn?t want you to know exactly what the assets or liabilities are because, as he puts it, ?it doesn?t matter to me and shouldn?t to you. Just make me money.?

Directions:

You have been provided the 2012, 2013, 2014, and partial 2015 income statements (see the Unit 6 TANSTAAFL Excel file). Examine the income statements closely to complete the following items below in the form of calculations and a written analysis and recommendation:

1. Perform and evaluate both cost and revenue differential analyses to determine which items are relevant. Report and explain your findings (indicate how you arrived at your calculations).
2. Identify which items on the income statement indicate this is a service or manufacturing organization. Explain your reasoning.
3. Perform both horizontal and vertical financial analyses on the 2012-2015 statements. Based on your horizontal and vertical analyses, build the optimal income statement for 2016. Determine and defend recommendations and reasoning on why these numbers are optimal (indicate how you arrived at your calculations).
4. Evaluate and report on any probable cause and ethical issues that could be behind the Founder?s unwillingness to share the balance sheet with you. Explain why it?s important to have access to the Balance Sheet.

Analysis Requirements: 1,250-1,500 words excluding the title page and references. Offer support of your opinions and findings from at least three scholarly or professional journal articles written within the last three years (cited in APA format). Include an introduction and conclusion, plus the projected budget spreadsheet, and other necessary charts. Insert the Excel spreadsheet as a table into the document. Do not attach the spreadsheet as a separate file.