As a result of the numerous lockdowns experienced in the state, Coffee-Bars Pty Ltd has had...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
As a result of the numerous lockdowns experienced in the state, Coffee-Bars Pty Ltd has had an extremely difficult time meeting its expenses at the chain of coffee shops. that it operates across the state. Jared has been acting as the director of Coffee-Bars Pty Ltd since his wife Jill was taken ill. As restrictions were lifted in the last month of the year, Jared resolves to make an aggressive push to get customers in and ensure that the business can return to profitable times. The business is however not able to get enough staff to work in the different outlets, as many of its employees moved into other sectors during the lockdown periods and are unwilling to return on account of the uncertainty in the industry. Orders have reduced and even the delivery service that the company has introduced is not helping as much as it could. This has affected Coffee-Bar's cash flow significantly. All of Coffee-Bar's assets have been given as security to the bank for the loan provided by the bank to upgrade the business to meet the demand that was expected after the lifting of the restrictions. Jared has approached the nk for further funding, but the bank has refused to offer any further financial facilities and is now threatening to realize their securities if Coffee-Bar defaults on its monthly repayments. Jared feels that he has exhausted all avenues. In April of the following year Coffee-Bar suppliers put the company on 'cash on delivery (COD) terms and Coffee-Bar's cash flow comes under significant pressure. The company is struggling to pay its creditors and is unable to meet it payroll expenses regularly and promptly. The few staff members remaining are disgruntled and threatening to commence legal action against Coffee-Bar to recover unpaid wages. Some cheques given to creditors as payment are dishonoured and the company appears to be unable to meet its tax obligation of taxes of $3 million that will be due and payable by the end of July. Jared soon hears of an opportunity to take up a commercial space that was occupied by a sector leading restaurant in the middle of the city. In the hope that the opportunity might just be what Coffee-Bar needs to improve on its financial position, Jared signs the lease for the premises and begins to engage with commercial fit-out specialists. Business has not improved, and Coffee-Bar is unable to pay its debts as they fall due. Jared is now very worried and comes to you for advice. He believes that he is not even properly appointed as a director of coffee-bars Pty Itd. Required: -whit the aid of relevant provisions of the corporation's act 2001 (stb), advise jarred in detail weather he is a properly appointed director of coffee-bars Pty Itd, and if so, whether he has breached the insolvent trading provisions and, if so, whether are any defences available to him. As a result of the numerous lockdowns experienced in the state, Coffee-Bars Pty Ltd has had an extremely difficult time meeting its expenses at the chain of coffee shops. that it operates across the state. Jared has been acting as the director of Coffee-Bars Pty Ltd since his wife Jill was taken ill. As restrictions were lifted in the last month of the year, Jared resolves to make an aggressive push to get customers in and ensure that the business can return to profitable times. The business is however not able to get enough staff to work in the different outlets, as many of its employees moved into other sectors during the lockdown periods and are unwilling to return on account of the uncertainty in the industry. Orders have reduced and even the delivery service that the company has introduced is not helping as much as it could. This has affected Coffee-Bar's cash flow significantly. All of Coffee-Bar's assets have been given as security to the bank for the loan provided by the bank to upgrade the business to meet the demand that was expected after the lifting of the restrictions. Jared has approached the nk for further funding, but the bank has refused to offer any further financial facilities and is now threatening to realize their securities if Coffee-Bar defaults on its monthly repayments. Jared feels that he has exhausted all avenues. In April of the following year Coffee-Bar suppliers put the company on 'cash on delivery (COD) terms and Coffee-Bar's cash flow comes under significant pressure. The company is struggling to pay its creditors and is unable to meet it payroll expenses regularly and promptly. The few staff members remaining are disgruntled and threatening to commence legal action against Coffee-Bar to recover unpaid wages. Some cheques given to creditors as payment are dishonoured and the company appears to be unable to meet its tax obligation of taxes of $3 million that will be due and payable by the end of July. Jared soon hears of an opportunity to take up a commercial space that was occupied by a sector leading restaurant in the middle of the city. In the hope that the opportunity might just be what Coffee-Bar needs to improve on its financial position, Jared signs the lease for the premises and begins to engage with commercial fit-out specialists. Business has not improved, and Coffee-Bar is unable to pay its debts as they fall due. Jared is now very worried and comes to you for advice. He believes that he is not even properly appointed as a director of coffee-bars Pty Itd. Required: -whit the aid of relevant provisions of the corporation's act 2001 (stb), advise jarred in detail weather he is a properly appointed director of coffee-bars Pty Itd, and if so, whether he has breached the insolvent trading provisions and, if so, whether are any defences available to him.
Expert Answer:
Related Book For
Project Management The Managerial Process
ISBN: 9781260570434
8th Edition
Authors: Eric W Larson, Clifford F. Gray
Posted Date:
Students also viewed these business communication questions
-
As a result of the North American Free Trade Agreement, many iconic American cars are not assembled in the United States. Explain why. Provide some examples of U.S. cars that are assembled outside of...
-
As a result of the income she generated from her on-campus job, Anh found herself with a small amount of disposable income. In early 2013, she took $ 1,000 of her disposable income and purchased...
-
As a result of his observations, Roemer concluded that eclipses of Io by Jupiter were delayed by 22 min during a 6 month period as the Earth moved from the point in its orbit where it is closest to...
-
Harry Bhel carries a business as a sole proprietorship. During its 2022 fiscal period, its first year of operations, the business had cash sales of $123,000. It also has sales on account of $46,000,...
-
Wiggley S&L issues a standard 30-year fixed rate mortgage at 7.8% for $150,000. Thirty-six months later, mortgage rates jump to 13%. If the S&L sells the mortgage, how much of a loss is incurred?
-
1. Draw a graph showing the AFC, AVC, AC and MC curves corresponding to the figures in the above table. 2. Calculate a new set of figures for each of the columns (4)(10) if (a) The price of capital...
-
What is the difference between a cause of action and an affirmative defense?
-
Several years ago, Blaha Company purchased Husker Company as a subsidiary. At that time, Blaha Company recorded goodwill of $100,000 related to the purchase. Since that time, the company has not...
-
Explain why a matrix organizational structure would work for Nike? Draw an image of the structure and list 3 improvements you can make to it.
-
1. Which of the two basic reporting approaches for the cash flows from operating activities did Lowes use? Is this the same as what The Home Depot used? 2. What amount of cash did Lowes receive from...
-
While creating a satisfied workforce does not guarantee organizational success, there are indeed benefits to high job satisfaction. What are some outcomes/consequences of high job satisfaction? Based...
-
Compute the area in the bounded that is , finite regions between y = x ( x 1 ) ( x 2 ) and the x - axis.
-
Explore the intersection of science fiction and philosophical inquiry in the works of authors like Ursula K. Le Guin or Isaac Asimov. How do these writers use speculative scenarios to explore ethical...
-
The following selected transactions relate to investment activities of Ornamental Insulation Corporation during 2024. The company buys debt securities, intending to profit from short-term differences...
-
Find the distance from the point P ( 2 , - 4 ) to the line passing through the points A ( 0 , 2 ) and B ( - 3 , 0 )
-
How much is XYZ's Total Cash Flow from Operating Activities for the year? Depreciation Expense $68,000 Accounts Receivable Increase 22,000 Inventory Decrease 25,000 Accounts Payable Decrease 14,000
-
The merger between Citi and Travelers was one of the worst big bank mergers in history. The stock is down over 80 per cent since the merger. Citi has problems with money laundering in different...
-
For each of the following transactions, indicate whether it increases, decreases, or has no effect on the following financial ratios: current ratio, debt-to-equity ratio, profit margin ratio, and...
-
What major information would you expect to find in a project audit?
-
Which of the eight traits/skills associated with being an effective project manager is the most important? The least important? Why?
-
The G&E Company is preparing a bid to build the new 47,000-seat Shoreline baseball stadium. The construction must start on June 10, 2019, and be completed in time for the start of the 2022 season. A...
-
A Ltd owns 100% of the issued share capital of B Ltd and 70% of the issued share capital of C Ltd. C Ltd owns 70% of the issued share capital of D Ltd. (a) Which companies are associated with A Ltd?...
-
S1 Ltd and S2 Ltd belong to the same capital gains group. In May 2020, S1 Ltd transferred a chargeable asset to S2 Ltd. The original cost of this asset to S1 Ltd was 10,000 and its market value in...
-
The ordinary share capital of W Ltd (which is a trading company) is owned 30% by X Ltd, 25% by Y Ltd and 45% by Z Ltd. All of these companies are UK resident and they prepare accounts to 31 March....
Study smarter with the SolutionInn App