Sales Price Per Uni 119.99 Income Statement Gross Sales Discounts Net Sales 179,985,000 16,362,273 163,622,727 Strengths...

Transcribed Image Text:

Sales Price Per Uni 119.99 Income Statement Gross Sales Discounts Net Sales 179,985,000 16,362,273 163,622,727 Strengths of this Income Statement? Risks of the operating model? Areas they need to focus on cost reduction? 10% Cost of Goods Sold 57,267,954 Gross Margin % of Sales 106,354,773 6500% Annual Sales (Unit 1,500,000 Discounts/Refund: Gross Margin Payroll Supplies Utilities Transaction Fees Marketing Administrative Corporate Overhea Depreciation Income Tax Rate Payroll % of Sales 40905681.75 25% Other Operating Expenses Supplies 8,181,136 Utilities 3,272,455 Fees 4,090,568 Marketing 16,362,273 Admin 8,181,136 Total Operating Expenses 40,087,568 % of Sales 2450% 25% Operating Margin 15% Corp Overhead Depreciation Income Taxes Total Other Costs 40,905,682 8,181,136 12,598,950 61,685,768 % of Sales 38% Analysis Good gross margin and operating margin. High allocation of corporate overheads. Areas they need to focus on cost reduction - Payroll and other operating expenses. Net Income % of Sales -36,324,245 -22% Financing Considerations What is the business structure of the company you analyzed? sole prop, LLC, S Corp, C Corp? Given the structure identified above, is additional capital easier or more difficult to acquire? Raising Equity Cons? Issuing Debt- Cons? - what are the pros? pros? How would you recommend the company finances growth moving forward? IIIII Sales Price Per Uni 119.99 Income Statement Gross Sales Discounts Net Sales 179,985,000 16,362,273 163,622,727 Strengths of this Income Statement? Risks of the operating model? Areas they need to focus on cost reduction? 10% Cost of Goods Sold 57,267,954 Gross Margin % of Sales 106,354,773 6500% Annual Sales (Unit 1,500,000 Discounts/Refund: Gross Margin Payroll Supplies Utilities Transaction Fees Marketing Administrative Corporate Overhea Depreciation Income Tax Rate Payroll % of Sales 40905681.75 25% Other Operating Expenses Supplies 8,181,136 Utilities 3,272,455 Fees 4,090,568 Marketing 16,362,273 Admin 8,181,136 Total Operating Expenses 40,087,568 % of Sales 2450% 25% Operating Margin 15% Corp Overhead Depreciation Income Taxes Total Other Costs 40,905,682 8,181,136 12,598,950 61,685,768 % of Sales 38% Analysis Good gross margin and operating margin. High allocation of corporate overheads. Areas they need to focus on cost reduction - Payroll and other operating expenses. Net Income % of Sales -36,324,245 -22% Financing Considerations What is the business structure of the company you analyzed? sole prop, LLC, S Corp, C Corp? Given the structure identified above, is additional capital easier or more difficult to acquire? Raising Equity Cons? Issuing Debt- Cons? - what are the pros? pros? How would you recommend the company finances growth moving forward? IIIII