You are a part$-$time accountant for a small local retail company. You provide Patricia Zho, the owner of the company, with quarterly reports summarizing her income and expenses. Together you determine a budget and compare it to actual data to help make important decisions such as ordering merchandise and providing raises.

After two years of continual losses and sales you believe Patricia must reduce her payroll she has consistently refused to consider the suggestion in the past stating that her employees are like family and she cannot reduce their wages or fire anyone. She'd rather go out of business. At this point the data are telling you that she will have to close her door if she does not reduce payroll. Twenty$-$five people are on the payroll averaging $$35,000$ a year each. Sales continue to decline. Inventory costs her $40\%$ of the sales price.

$1.$ To help her understand the situation write a memo giving her the bad news. Memos are hardcopy documents that follow a set format. Use the indirect organization strategy opens with relevant, attention$-$getting details that do not directly state the purpose of the document. The purpose is revealed in the body of the message, usually sandwiched between supporting details.