Supply Chain Business2

1,Appendix A-Balance SheetYear 1 Year 2Fixed AssetsPremise 42900 57890Plant&Machinery 56000 66890Fixture&Fitting 6080 12400Motor Vehicles 581450 567239686430 704419Current AssetsStock(Closing) 2265 3455Debtors 7800 3244Cash 28000 56900Analysis and Compare :the second year fixed assets are more than the first year, the reason is the purchasing power of the new fixed assets, enterprise expansion.the second year stock (closing) are more than the first year the reason is increase sales.the second year debtors are less than the first year, the reason is to recover the accounts receivable, credit decrease, and enterprises to strengthen the control of the credit.the second year cash are more than the first year, the reason is the cash sales increase, the recovery of accounts receivable and delayed payment of accounts payable.The Capital StructureYear 1 Year 2Capital 500300 500000Retained Profit 110363 _______Analysis and Compare :The enterprise owners to withdraw some moneyLiabilitiesYear 1 Year 2Long-term liabilitiesDebentures _________ 500300 _________ 500000 Loan 50000 520000Short-term liabilitiesCreditors 13600 16890 Bank overdraft20600131890Analysis and Compare :the second year debentures are less than the first year, the reason is enterprise changed its long-term financing, long-term financing amount is reduced.the second year loan are more than the first year, the reason is sales growth, the enterprise has changed its financing ways, from the loan to bond.the second year creditors are more than the first year, the reason is companies have recovered the accounts receivable.the second year bank overdraft are more than the first year, the reason is enterprise are in bank overdraft as its short-term financing way, which will cause the burden of servicing.Appendix B-Profit and Loss Account Less and CostYear 1 Year 2 Salaries 75730 82349 Building Cost 34820 36788 Communications 1567 1682 Vehicle Costs 23000 34566 Maintaining326768386552the second year less and cost is more than the first year, the reason is enterprise expansion., its purpose is to generate revenue.ProfitYear 1 Year 2 Gross Profit 370000 502680 Net Profit43232116128the second year profit is more than the first year, the reason is sales revenue increase.2,Gross Profit Percentage=%100Pr SalesofitG rossY 1 Gross profit percentage=%100500000370000⨯=74%Y 2 Gross profit percentage=%100657000502680⨯=76.5%Analysis :The gross profit percentage on B relative to A gross percentage increased, it is good. The reason is sales increase, gross profit also increased.Recommendation: Give customer preference, and reduce the cost.Net Profit Percentage=%100Pr ⨯SalesofitNetY 1 Net profit percentage=%10050000043232⨯=8.6%Y 2 Net profit percentage=%100657000116128⨯=17.7%Analysis :The net profit percentage on B relative to A gross percentage increased, it is good. The reason is sales increase, net profit also increased.Recommendation: To continue with the current sales policy, and according to the market changes to make an adjustment to adapt to the feasible.Asset Turnover=%100⨯ssetsOperatingA SalesY 1 Asset turnover=%100686430500000⨯=72.8%Y 2 Asset turnover=%100704419657000⨯=93.3%Analysis:The Asset turnover on B relative to A gross percentage increased, it is good. The reason is sales increase.Recommendation: The increase in sales at the same time, reduce the operating assets investment.Stock Turnover=ckInPeriorAverageSto sCostOfSaleY 1 Stock Turnover=2265130000=57 times per yearY 2 Asset turnover=3455154320=45 times per yearAnalysis:The stock turnover on B relative to A gross percentage decreased, it is bad. The reason is commodity sales cost increase, sales increase.Recommendation: To reduce closing stock and costs of sales.3,January February March BudgetPurchasing price 222 222 222 Fuel444444 444 Maiatuance&Repairs 194 194 194 858 858 858 ActualPurchasing price 222 222 222 Fuel450450 450 Maiatuance&Repairs 200 200 200 872 872 872 VarianceA 14A 14A 14According to the data in the table, the budget balance is negative balance, it will be created a shortage of cash.Therefore put forward the following solutionsTo boost cash receipt we could consider any of the following action:Inject new capital from the owner●Raise an overdraft or bank loan●Increase the level of sales (for example, by promotional activities)●Reduce the period of credit allowed to customers to accelerate receipt of cash from them●Encourage prompt payment by customers (for example, bu offering discounts in return).To reduce cash payments we could consider any f the following action:●Defer capital expenditure (or finance capital items by borrowing or leasing instead ofpayment from cash)●Reduce purchases from suppliers, perhaps by running down stock levels●Negotiate discounts from suppliers to reduce purchase costs●Negotiate increased credit period from suppliers to defer payments to them.。