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Jim And Mason Growing Pains Case

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Patrick R. Price2004-08-22T17:16:00Financial Analysis and Forecasting Growing Pains Questions Since this is the first time Jim and Mason will be conducting a financial forecast for Oats’ R’ Us, how do you think they should proceed? Which approaches or models can they use? What are the assumptions necessary for utilizing each model? Jim and Mason should begin their planning with a reasonable sales forecast. The sales forecast ought to be based on clearly stated assumptions about future economic conditions. Next, they should prepare pro forma financial statements by either assuming that the key items vary proportionately with sales or remain constant (as the case may be). Based on their asset utilization rate, they would be …show more content…

| 533,000 | 17.8% | Plant & Equipment | | 560,000 | 11.9% | 560,000 | 14.9% | 560,000 | 18.7% | Accumulated Depreciation | | 175,000 | 3.7% | 150,000 | 4.0% | 125,000 | 4.2% | Net Plant & Equipment | | 385,000 | 8.2% | 410,000 | 10.9% | 435,000 | 14.5% | Total Assets | | 1,206,916 | 25.7% | 1,072,376 | 28.5% | 968,000 | 32.3% | Liabilities and Owner 's Equity | | | | | | | | Accounts Payable | | 135,000 | 2.9% | 151,352 | 4.0% | 128,000 | 4.3% | Notes Payable | | 275,000 | 5.9% | 275,000 | 7.3% | 250,000 | 8.3% | Other Current Liabilities | | 43,952 | 0.9% | 50,000 | 1.3% | 46,000 | 1.5% | Total Current Liabilities | | 453,952 | 9.7% | 476,352 | 12.7% | 424,000 | 14.1% | Long-term Debt | | 275,000 | 5.9% | 250,000 | 6.6% | 300,000 | 10.0% | Total Liabilities | | 728,952 | 15.5% | 726,352 | 19.3% | 724,000 | 24.1% | Owner 's Capital | | 155,560 | 3.3% | 155,560 | 4.1% | 155,560 | 5.2% | Retained Earnings | | 322,404 | 6.9% | 190,464 | 5.1% | 88,440 | 2.9% | Total Liabilities and Owner 's Equity

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