Dealership Financial Statements Assignment

Dealership Financial Statements Assignment

Using the financial statement provided to you (do not use the assignment for the course), calculate and analyze the frozen capital of the dealership.

1. Prepare a memo as if you were writing to the Dealer Principal which reports on the results of your assessment. Assume he/she doesn’t know what frozen capital is or why you are checking these numbers. You must be explicit and clearly explain, for example, what is wrong with the numbers.
   • Calculate the following types of frozen capital to include in the report: Dealership Financial Statements Assignment
     1. Accounts receivable (don’t forget to deduct any related allowances from the totals.)
     2. Warranty receivables
     3. Used truck inventory (include remarketed vehicles in the assets and CGS. Exclude wholesale sales from the sales figures.)
     4. Parts inventory (don’t forget to deduct any related allowances from the totals.)

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• • The final submission should include the following in one Word document:
    1. An introduction to telling the reader why you are writing the memo. What is the memo about and how did you arrive at your analysis.
    2. Use clear headings to show each section. (Bold or underline or larger font – or a combination of these.)Your report should have a section devoted to each of the 4 calculations listed above.
    3. Show your calculations and numbers you used in the body of the report as a figure/table next to where you discuss it. Cut/paste them into the body of your report that is good. Excel and Word will let you do this or take a picture and crop it to insert in the right place.
       • Do not just attach the calculations in a separate document. And don’t just copy the chart at the end of the memo. The right information needs to be in the right section of the report. Dealership Financial Statements Assignment
       • Each section will include its own title, intro text, calculations, and then the explanation for the section.
       • Hint: If you want to cut/paste from Excel to Word it looks nicest if you “paste as a picture”. If you are not sure how to do this, email to ask (or Google it).
    4. Explain what the result of your calculation means. Are things ok? Is there a problem? What sort of problem? How do you know? Provide the related analysis for each ratio before going on to the next one. Show that you understand what the calculation is telling the dealer. Do not just repeat the amounts which you have included in the report and the math – that is a duplication of facts and is not needed as you will include your calculations in an image. Tell the reader what they might need to do to fix it.
    5. A conclusion that summarizes the results and identifies the biggest issue which the dealership should fix first.

Dealership Financial Statements Assignment