The case Stripe Supply Ltd. is an industrial supply company. Stripe primarily supplies finishing products to condominium, apartment, and industrial building construction companies. A new customer, Wendel Enterprises Ltd., would like to make a $550,000 purchase of paint and related supplies. This is a large order for Stripe which would be close to 15% of all average current sales for Stripe Supply for a year. You have been asked to provide a recommendation on whether or not to extend credit (essentially a short-term loan) to Wendel Enterprises. Wendel's CFO has also proposed two other potential investment options. One option would be to grant long-term credit to Wendel. Another option is to provide the funds by having Stripe purchase shares in Wendel. You are to consider and conclude on all three issues. You are reporting to the CEO of Stripe Supply Ltd. Your group is a consulting firm (make up your own company name), and your firm has been hired by the CEO of Stripe Supply Ltd. to provide a presentation. The CEO is the user of the Presentation, not your professor. Stripe Supply Ltd. is considering three possible ways to be involved with Wendel Enterprises Ltd.: grant them short-term credit grant them long-term credit purchase shares of Wendel analyze the financial data and conclude on all three options. recommend the BEST option and give reasons. You have been provided industry information to be used as an industry benchmark.

Analysis- five sections need to be addressed: Profitability, Asset Utilization, Liquidity, Debt Utilization, and Other Items. present high level analysis for each one, based on the ratios you are presenting in your Appendix. likely want to discuss and highlight: o the trend of the ratios from year to year and compared to Industry o what the ratios tell us about the company in general or its financial management. o any inter-relationships between ratios that might be important. o HINT: need to go beyond simply commenting on increase/decrease or better or worse than prior years or industry. Consider how the ratios relate to the financial statement accounts. For example, if the current ratio is increasing because inventory is increasing, is that an advantage or disadvantage? If the ratios indicate any problem areas or good financial management, provide your observations and comments.

Conclusion and Recommendations - Based on your analysis, state and explain why Stripe should or should not: (1) grant short-term credit to Wendel (2) grant long-term credit to Wendel, and/or (3) consider purchasing shares in Wendel TIP: If you had to pick just one option, which one would it be? Make sure that is clear to the audience.

Appendix (Ratios Page) Provide a well-organized set of ratio values calculated based on the financial statements (Appendix A) and related information (Appendix B).

Using the table below, please calculate the following: Profitability, Asset Utilization, Liquidity, Debt Utilization, compare result with the industry norms, and Conclusion and Recommendations - Based on your analysis, state and explain why Stripe should or should not: (1) grant short-term credit to Wendel (2) grant long-term credit to Wendel, and/or (3) consider purchasing shares in Wendel TIP: If you had to pick just one option, which one would it be? Make sure that is clear to the audience.

		Appendix A
Wendel Enterprises Ltd
Income statement
	2023	2022	2021
Sales (all on credit)	3,210,200	3,682,600	3,085,400
Cost of goods sold	2,517,900	2,794.80	2,349,600
Gross profit	692,400	887,800	735,800
Selling and administration expenses	531,300	513,700	588,400
Amortization	28,000	28,800	32,000
EBIT	133,100	345,300	115,500
Interest Expenses	130,200	101,100	100,200
Earning before taxes	2,900	244,200	15,200
Taxes	700	54,200	4,400
Earning after tax	$2,200	$190,000	$10,800
Dividends declared	$140,000	$130,000	$120,000
Balance Sheet at December 31
	2023	2022	2021
Assets
Cash	$29,800	49,400	23,000
Marketable securities	14,000	14,000	14,000
Account receivable	821,600	723,600	594,600
Inventory	513,200	660,000	579,800
Prepaid Expenses	10,400	1,600	11,000
Total Current Assets	1,389,000	1,448,600	1,222,400
New plant and equipment	324,000	345,800	368,600
Goodwill	50,800	56,400	61,200
Total Assets	1,763,800	$1,850,800	$1,652,200
Liability and Shareholders Equity:
Account payable	$291,800	$393,400	$419,400
Bank Loan	506,800	402,800	388,000
Accrued Expenses	7,400	47,400	28,800
Total Current Liabilities	806,000	843,600	786,200
Long-term debt	451,600	363,200	282,000
Total Liabilities	1,257,600	1,206,800	1,068,200
Common Stock	28,000	28,000	28,000
Retained Earnings	478,200	616,000	556,000
Total Shareholders Equity	506,200	644,000	584,000
Total Liabilities and shareholders equity	$1,763,800	$1,850,800	$1,652,200
	Industry Norms
	Appendix B
Profitability ratios:	Construction industry
Current ratio	1.60
Quick ratio	1.10
Profit Margin	580.00%
Return on assets	8.10%
Return on equity	20.30%
Assets Utilization:
Receivables turnover	6.30
Average collection period	58.30
Inventory turnover	4.3
Capital asset turnover	8.00
Total asset turnover	1.70
Debt Utilization:
Debt to total assets	60%
Times interest earned	4.30