Marcello's Ice Cream

MARCELLOS FAMOUS trumpery CREAM (PTY) LIMITED 1. Question 1: Analyse and Comment on the Financial Health of the Firm 1.1 Income Statement The future(a) forms an comp barium of the Income Statement of Marcellos famous Ice-Cream ? ? gross revenue do been relatively flat year on year, with only a cold-shoulder growth from 2004 2006. Therefore, Marcellos extrusion of R2.5 million for 2006 is ambitious. He has braggy at 3.8%, 3.7% and now he is looking for a 5% growth. New competitors mean he may hold in difficulty putting legal injury increases in. ? Cost of sales take up increased year on year, resulting in a devolve Gross amplification, and Gross boodle Percentage: social class end 2003 Sales Cost of Sales Gross Profit GP% 2210000 1768000 442000 20% class break 2004 2295000 1895000 436000 19% Year recess 2005 2380000 1952000 428000 18% ? ? His GP% is dropping, and is roughly lower than the sedulousness average turn up of 20%. The decreasing GP impacts directly the bottom line of business of the firm. Expenses ? Marcellos put downs take been increase year on year, importantly in the ecumenical and admin line expense. Marcellos derogation expense is decreasing. Marcello mentions that his costs nominate increased due to his  amend expenses termination up (salaries & wages) as mentioned in the case. The expenses includes interest paying.

Profit & revenue enhancement ? As a result of the change magnitude expenses, Marcellos pay forwards assess has been declining significantly from 2003 2005. This factor that the absolute tax that is payable is less, as the tax identify has stayed the same, at 50%. The industry norm for EAT is 3.5% and Marcellos is 1.5%. ? No dividends were paid out in 2003, 2004, 2005, and retained payment have been steady declining: Year End 2003 kept up(p) clams 85000 Year End 2004 57800 Year End 2005 33000 1.2 Balance Sheet keen Employed ? The shares have remained continuous over the time period, with a steadily increasing Retained Earnings figure. In turn, Total...If you compliments to get a plentiful essay, order it on our website: Ordercustompaper.com

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