QUESTION: prepare a Written Report on the following Case Study 2: Cash Flows and Financial Statements at Sunset Boards, Inc.

Characteristics of the Written Report::

Maximum number of pages: 4.

Cash Flows and Financial Statements at Sunset Boards, Inc. Sunset Boards is a small company that manufactures and sells surfboards in Malibu. Tad Marks, the founder of the company, is in charge of the design and sale of the surfboards, but his background is in surfing, not business. As a result, the companys financial records are not well maintained. The initial investment in Sunset Boards was provided by Tad and his friends and family. Because the initial investment was relatively small, and the company has made surfboards only for its own store, the investors havent required detailed financial statements from Tad. But thanks to word of mouth among professional surfers, sales have picked up recently, and Tad is considering a major expansion. His plans include opening another surfboard store in Hawaii, as well as supplying his sticks (surfer lingo for boards) to other sellers. Tads expansion plans require a significant investment, which he plans to finance with a combination of additional funds from outsiders plus some money borrowed from banks. Naturally, the new investors and creditors require more organized and detailed financial statements than Tad has previously prepared. At the urging of his investors, Tad has hired financial analyst Jameson Reid to evaluate the performance of the company over the past year. After rooting through old bank statements, sales receipts, tax returns, and other records, Jameson has assembled the following information: 2015 2016 Cost of goods sold $203,963 $257,528 Cash 29,429 31,267 Depreciation 57,576 65,076 Interest expense 12,530 14,345 Selling and administrative expenses 40,110 52,351 Accounts payable 52,015 57,708 Net fixed assets 254,017 316,825 Sales 400,111 487,712 Accounts receivable 20,854 27,050 Notes payable 23,708 25,885 Long-term debt 128,218 143,971 Inventory 43,884 60,222 New equity 0 24,192