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You have a friend that has their own business. They want someone to create financial statements for their company because the law states it is necessary. You claim that these statements are not just something you do because they are a legal requirement but will help the entrepreneur make sound business decisions to improve the company. Write a professional report in a standard format explaining your claim to your friend. a) Start by briefly explaining your friend's business and what they do. b) Use the information from the company you selected and demonstrate how different ratios can help in decision-making: Profitability ratios Efficiency ratios Liquidity ratios ● Investment ratios ● Financial gearing ratios c) Show the entrepreneur how to analyse and evaluate the differences observed between the two financial years, based on your results from b), and explain how the demonstration will assist in the entrepreneur's specific business. (Tip - when answering this section, you need to discuss the business of the selected company and the entrepreneur's business.) d) Perform a direct analysis of turnover, gross profit, net profit etc., between the two years. Explain to the entrepreneur the value of this knowledge in their decision making e) Create Excel graphs using the data obtained for the selected business in the two financial years to substantiate your analysis, discussion, and explanation to the entrepreneur, and include it in your report. f) Identify and explain difficulties when analysing the two financial years in terms of the two methods used for your analysis in b) and d) above, which the entrepreneur must note. g) Could you link a performance indicator that will apply nicely in the entrepreneur's business? Explain your answer. You have a friend that has their own business. They want someone to create financial statements for their company because the law states it is necessary. You claim that these statements are not just something you do because they are a legal requirement but will help the entrepreneur make sound business decisions to improve the company. Write a professional report in a standard format explaining your claim to your friend. a) Start by briefly explaining your friend's business and what they do. b) Use the information from the company you selected and demonstrate how different ratios can help in decision-making: Profitability ratios Efficiency ratios Liquidity ratios ● Investment ratios ● Financial gearing ratios c) Show the entrepreneur how to analyse and evaluate the differences observed between the two financial years, based on your results from b), and explain how the demonstration will assist in the entrepreneur's specific business. (Tip - when answering this section, you need to discuss the business of the selected company and the entrepreneur's business.) d) Perform a direct analysis of turnover, gross profit, net profit etc., between the two years. Explain to the entrepreneur the value of this knowledge in their decision making e) Create Excel graphs using the data obtained for the selected business in the two financial years to substantiate your analysis, discussion, and explanation to the entrepreneur, and include it in your report. f) Identify and explain difficulties when analysing the two financial years in terms of the two methods used for your analysis in b) and d) above, which the entrepreneur must note. g) Could you link a performance indicator that will apply nicely in the entrepreneur's business? Explain your answer.
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Your Name Your TitlePosition Date Recipients Name Recipients TitlePosition Recipients Company Address Dear Recipients Name Subject Importance of Financial Statements for Informed DecisionMaking I hope ... View the full answer
Related Book For
Canadian Income Taxation Planning And Decision Making
ISBN: 9781259094330
17th Edition 2014-2015 Version
Authors: Joan Kitunen, William Buckwold
Posted Date:
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