BUS 450. Motomart info. Accounting, Finance, SPSS Coursework

 
 
Motomart Info
Name and complete mailing address
Student number
Course title and number: BUS 450
Date
 
 
 
Step 1 – Provide comments on a 5 year Income Statement.

	1984	1985	1986	1987	1988
Net Variable Revenues	$2,885,969.00	$3,828,255.00	$4,086,667.00	$3,940,799.00	$4,298,748.00
Semi-Fixed (S-F) Expenses:
Salaries	$613,006.00	$968,789.00	$1,211,464.00	$1,289,758.00	$1,360,489.00
Vacation	600	26,705	19,468	19,059	18,268
Advertising & Training	210,226	288,347	281,219	309,608	371,314
Supplies/Tools/Laundry	31,473	46,141	75,468	65,935	81,252
Freight	5,719	5,987	6,528	5,731	4,663
Vehicle	22,913	23,718	23,664	20,370	19,483
Demonstrators	10,465	4,969	-1513	4,192	707
Floor-Planning	278,531	301,113	276,201	156,129	305,044
Total S-F Expenses	$1,172,933.00	$1,665,769.00	$1,892,499.00	$1,870,782.00	$2,161,220.00
Fixed Expenses
Total Fixed Expenses	$1,449,208.00	$2,050,172.00	$2,290,867.00	$2,164,362.00	$2,653,620.00
Operating Profit/(Loss)**	$263,828.00	$112,314.00	($96,699.00)	($94,345.00)	($516,092.00)

 
Generally, there was a decline in operating profits from 1984-1988, as the profit was 263,828 in 1984 and $516,092 loss in 1988 (Cataldo & DeJoy, 2014). The vacation expenses increased from $ 600 to 26,705 and then declined from 19,468 50 18,268 in 1986 to 1988, but there is no information on what could have caused this.  It does not seem right that the cost of demonstrators was ($1,513) in 1986, which then increased to 4,192 in 1987, which is a 377.07% change and $ 707 in 1988 . There appears to be no direct link between the new retail vehicles sold (NRVS) and the demonstrators, and the changes were rapid. The floor-planning expenses in 1987 were $156,129, a $ 120,072 decrease from 1986, which has not been explained. Even with increasing net variable revenues over the five year, the operating profits decreased and there were operating losses from 1986.
 
Step 2 – Discuss patterns in expense items.
The semi-fixed expenses increased from 1984-1986 then declined in 19878, but increased in 1988 to 2,161,220 (Cataldo & DeJoy, 2014).The  vacation expenses are unusual  since in 1984, they were incurred only in July and November ,  while  there were no vacation expenses in the 29^th and 30^th months of 1986 and the 41^st month of 1987. For the freight expenses, there were negative balances the first being on the 20^th month at ($20), and for the 39^th, 45^th, 55th and 58^th months. Similarly, there were negative balances in the demonstration expenses in more instances than the freight costs.  The floor-plan expenses were the most inconsistent for the 60 months, increasing and reducing one month to the other by big margins. For instance, in the first month the cost was ($ 78,173) followed by $ 28,456 in the next month and $5,697 in the fourth month. In the case of the supplies/tools/laundry expenses the negative balance was only on the 28^th month.
Step 3 – High/Low activity levels