Summer Dreaming Frozen Treat Co.”

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“Summer Dreaming Frozen Treat Co.”
Mid-Term Case Analysis Report
Raymond Liang (020783064)
June 23, 2009
Prepared for: John Miller Shelly Millman

Table of Contents

Executive Summary 3
Context/Background Information 4
Overview of Procedures 4
Profit and Financing Analysis 4 Revenue Analysis 4 Cost Analysis 5 Financing Activities 5 Advertisements 6
Recommendation 7
Action and Implementation 7
Assumptions 8
Appendices and Exhibits 9

Executive Summary

Summer Dreaming Frozen Treat Company (SDFT Co.) is a company that sells frozen products across the city using pedal-powered carts. The company is planning for another year of operations, and has made a request to prepare a budget for
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Additionally I will create a worksheet that will allow end-users to explore their options and display scenarios, based on different prices, costs, volume, and other manufacturing factors.

I will first determine the amount of revenues that is expected to be generated. Second I will calculate the costs, I will then determine if we have enough financing required to pay suppliers according to their credit terms. With the calculations from the three areas I will prepare a cash budget for the month of April and May. Lastly, I will create an analysis of profits if the company chose to run advertisements.

Profit and Financing Analysis

Revenue Analysis

Based on the forecasted monthly demand, cash collections for the month of April and May come to $115,200 and $230,400 (see Appendices 1). Since all sales are in cash, there are no bad debts or accounts receivable to be collected on following months.

Cost Analysis

Cost of goods is $0.40 per treat and they are sold to SDFT Co. in 144 treats per case, since we predicted 1,000 cases for April it would come to $57,600 and $115,200 for 2,000 cases in May (see Appendices 2). The cost of goods is payable in the following month, so there will be no cash payment necessary in the month of delivery.

The wages for the cyclist would be

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