(Source at last)

24. In 2011, Threadless hired a Vice President of Finance to better plan and direct the organization's activities, which is a use of

A. Public accounting

B. Bookkeeping

C. Forensic accounting

D. Managerial accounting

25. Because a majority of sales at Threadless occur at the end of the year, Threadless needs to be aware of the movement of money over a daily, monthly, weekly, or yearly basis, which is referred to as

A. Liabilities

B. Annual report

C. Bookkeeping

D. Budget

E. Cash Flow

26. Before 2011, Threadless had a warehouse full of inventory, printing press, and other equipment used for shipping. In the accounting equation, these items were listed as

A. Accounts receivable

B. Depreciation

C. Revenue

D. Assets

E. Liabilities

27. The total amount of money received from the sale of t-shirts and other textiles at Threadless represents the company's

A. Operating profit

B. Gross profit

D. Revenue

E. Net income

F. Gross earning

28. If the owners of Threadless want a clear picture of the company's overall revenues and the costs incurred in generating those revenues, they should request a(n)

A. Ratio Analysis.

B. Statement of Cash flow

C. Balance Sheet

D. Income statement.

2:16to put some light guardrails 2:18around where we were, 2:19help the business prioritize limited resources, 2:22and pursue those that had the most promise. 2:25>> The key responsibility of the financial manager is planning and budgeting. 2:28>> Since we are primarily an apparel-based e-commerce business, 2:31consumer-driven business, a majority of the company sales 2:34will occur towards the end of the year during the holiday season. 2:36So we will set an annual budget typically after the end of the holiday, 2:40take a little bit of time to review the prior year, 2:43set company-wide goals for the upcoming year, 2:47and then we will supplement the annual budget 2:50with quarterly forecasts and budgets, as well. 2:52One of the nice things about an online business 2:55is you get immediate feedback to a specific promotion. 2:58If it's working, if it's generating consumer demand, 3:02you will see that immediately on the website in the form of customer orders. 3:05If it isn't, you will see that immediately in the form of no customer orders. 3:08>> In 2016, the company switched to 100% on-demand printing. 3:13unlike the old silk-screen method, where you had to order in bulk, 3:16this new technology made it cost-effective for vendors 3:19to print one shirt at a time and then ship to customers directly. 3:23Threadless never has to touch the product. 3:26The result was that a significant amount of fixed cost was taken out of the operations. 3:30We no longer needed a warehouse. 3:32We no longer needed to hold millions of dollars in a warehouse, 3:36and that dramatically improved the company's working capital cycle. 3:39The other benefit was that on-demand allowed us to then work with a greater number of artists, 3:46and also a greater number of products. 3:48>> Today, 95% of Threadless' revenue comes from their online businesses, 3:53with additional income from licensing their artwork to other companies. 3:56And they are back to having extremely low overhead. 3:59>> So, with Threadless being a primarily online business, 4:04fulfilling its orders 100% on an on-demand basis, 4:07the company literally has zero assets. 4:10Our actual valuable assets are our people and the company's website and brand. 4:16And so from that aspect, you know, site-maintenance costs, rent, 4:20and people are essentially the majority of the company's costs. 4:24>> The story of Threadless is a story of unlimited creativity 4:28supported by strong financial management. 4:30Using their crowdsourcing business model, threadless. 4:33com has become a multimillion-dollar company from an initial investment of $1,000. 4:38Most importantly, they have been able to maintain and build their creative community. 4:42>> So, when I first started at Threadless, I honestly felt like, during the first 18 months, 4:46that everything was falling off the rails.0:01>> Visit Mordor, Sunset Six, Rebel Lighthouse. 0:05 You want a cool t-shirt? 0:06Head on over to threadless. 0:07com. 0:08If you can't find one you like, you can submit your own designs. 0:12Threadless. 0:12com is an e-commerce website based in Chicago. 0:15The site sells t-shirts and more -- hats, tote bags, 0:18iPhone cases, shower curtains, you name it. 0:21The designs are all created by artists who submit via the threadless. 0:24com website. 0:25Users vote for their favorite images, 0:27and the winners are printed and sold on the website. 0:30The company was founded in 2000 by Jake Nickell and Jacob DeHart, 0:34with an initial investment of $500 each. 0:36Selling t-shirts wasn't new, but their method of having the public create and vote on designs was. 0:42Threadless was one of the first business to use crowdsourcing, and that kept costs down. 0:47>> For Jake to keep costs low and start this business, 0:50what he did was essentially accept pre-orders 0:52for all of the designs that won his online competition. 0:56But taking pre-orders, he then was able to have funds in hand, 1:00and then he would use those funds to then go 1:02and buy a blank-t-shirt inventory, 1:05and then bring those shirts to a local screen printer 1:10and have the designs printed. 1:11From there, he brought those shirts back to his apartment, 1:14and then he and his friends would basically go and pack orders and ship them. 1:19>> As the company made money, they were able to invest in printing shirts 1:22before they were sold. 1:24In order to do that, Jake needed warehouse space to hold finished good. 1:28Rent for that space was Threadless' first fixed cost -- 1:31an expense that they had to cover no matter how many shirts they sold. 1:34By 2006, the company had $18 million in revenue, 1:38stocked thousands of shirts in a huge warehouse, 1:41and had over 50 employees fulfilling orders from the website. 1:45At the end of 2011, Jason Macatangay joined Threadless as its Vice President of Finance. 1:51The company had grown to a point that it needed someone 1:54dedicated to financial management. 1:56For Jason, who had worked for Fortune 500 companies, 1:59the move to a smaller, entrepreneurial company was a shock. 2:02>> Coming to Threadless, incredibly entrepreneurial. 2:05Incredibly focused on speed to market. 2:07And, so, coming in, really, I wanted to try to see how I could complement 2:12the entrepreneurial mind-set 2:13that was here at this company with the need4:48To some degree, that's the nature of an entrepreneurial business. 4:51So while there was a certain amount of waste in the company that needed to be eliminated, 4:54you can't cost-cut your way to glory. 4:56So my role as financial manager at Threadless was to ensure 5:00that we had defined processes set up to help protect the company, 5:03but at the same time not in any way limit 5:07or inhibit the creativity 5:09upon which the business thrived. 5:11It's a narrow line to walk, but definitely one worth taking