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Scandi Home Furnishings Inc

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Scandi Home Furnishings Case Kaj Rasmussen founded Scandi Home Furnishings as a corporation during mid-2007. Sales during the first full year (2008) of operation reached $1.3 million. Sales increased by 15 percent in 2009 and another 20 percent in 2010. However, profits after increasing in 2009 over 2008 fell sharply in 2010 causing Kaj to wonder what was happening to his “pride and joy” business venture. After all, Kaj has continued to work as close as possible to a 24/7 pace beginning with the startup of Scandi and through the first three full years of operation. Scandi Home Furnishings, located in eastern North Carolina, designs, manufactures, and sells Scandinavian-designed furniture and accessories to home furnishings …show more content…

Balance Sheets 2008 2009 2010 Cash $50,000 $40,000 $10,000 Accounts Receivables 200,000 260,000 360,000 Inventories 450,000 500,000 600,000 Total Current Assets 700,000 800,000 970,000 Fixed Assets, Net 300,000 400,000 500,000 Total Assets $1,000,000 $1,200,000 $1,470,000 Accounts Payable $130,000 $170,000 $180,000 Accruals 50,000 70,000 80,000 Bank Loan 90,000 90,000 184,000 Total Current Liabilities 270,000 330,000 444,000 Long-Term Debt 300,000 400,000 550,000 Common Stock ($10 par)* 300,000 300,000 300,000 Capital Surplus 50,000 50,000 50,000 Retained Earnings

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