Case Study Objectives Upon completion of this case study report, you should be able to: 1. apply engineering economic decision making process, 2. prepare a detailed financial analysis report, and 3. provide a professional recommendation on the finding of the study. Current Business Report Anna Bakery Cafe offers casual life-style concept by offering variety selection of cakes, muffins, bagels and sandwiches either for dine in or take-away sets. The cafe has been operating since 2018, owned by a young graduate fresh out of college. She put up an initial investment of RM100,000 to buy the required equipment and initial renovations. She managed to secure a business loan from SME bank to be recovered within 3 years with interest rate of 12% pa. Sales has been growing at steady rate with revenues coming from both catering and bakery divisions. Sales was slow in the initial business start. As customer confidence grew, sales doubled in the second year and expected to taper out this year. It is estimated that the direct costs from raw materials for both businesses to be 50% of the revenues and slowly reducing as their efficiency improved, thus improving the profit margin. The annual revenues for both business divisions are shown in TABLE 1, where FY2018/2019 are actual values while FY2020 is a projection. TABLE 1: ABC Original Business Revenues (annual statement of income) FY2018 FY2019 FY2020 (P] Revenue Catering 324,000 827,200 1,000.000 Bakery 258,000 382,320 500.000 Total Revenue 582,000 1.209,520 1,500.000 Direct Cost (Material) Catering 195,800 205,720 330.000 Bakery 85,200 164,140 180.000 Total Direct Cost 280,800 459.800 610.000 Gross Margin(Profit) 301,200 749.860 090.000 Gross Margin % 52 62 66