Question
Your group has been hired by BluJay Aviation as business consultants. BluJay Aviation, Inc., has been in business for three years. The business has been
Your group has been hired by BluJay Aviation as business consultants. BluJay Aviation, Inc., has been in business for three years. The business has been profitable enough that Wren no longer works for the airport. She is now both an owner and employee of BluJay Aviation. Brad is still at the FBO, but also does some work for BluJay. An opportunity has arisen at the airport. The gift shop is available for lease. Wren and Brad have been thinking about taking over the operation of the shop in addition to running BluJay Aviation. Discuss this concept with your group, along with the advantages and disadvantages of running a retail operation in addition to their normal business. Financial statements for the most recent years of operation of the gift shop are supplied. Your business consulting group has received a second request for advice from BluJay Aviation, Inc. BluJay Aviation has allowed their clients to pay 30-60 days after services have been given. This causes their cash flow from operating activities to often be negative even though they are earning a profit. The economy has also made them nervous about collecting since a few businesses that use their services, especially the realtors, may not stay in business. Discuss with your group the various options available to BluJay in this situation. Choose two options they might try to improve their cash flow and also advise them about the valuation of their accounts receivable. Draw up a rough draft of what you are going to put in the final letter/report to BluJay for Episode 7. Remember, the best writing is done, edited, and redone. HNK Co. Income StatementsPreview the documentView in a new window Come to a conclusion about what they should do stating the reasons for your group decision. Draw up a rough draft of what you are going to put in the final letter/report to BluJay for Episode 6. Remember, the best writing is done, edited, and redone.
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