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What would suggest to make the business profitable again

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Reference no: EM132608658

You are studying a business's financial documents in order to see whether or not you would like to purchase it. You figure out the following facts

A. The sales has grown 25% each year in the past three years

B. The Company has made 10% profit 3 years ago, 15% profit two years ago and 10% loss last year

C. In order to pay for all expenses last year, the company has taken a loan for $100,000 with 15% annual interest year to be paid over 2 years

D. There has been 40% payroll increase last year

E. The companies liabilities is twice as its assets last year

Considering the above data, answer the following questions

Question I. Would you buy the business or not? Why?

Question II. What do you think has caused the financial stress last year?

Question III. What would you suggest to make the business profitable again?

Reference no: EM132608658

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