Decision Case 2-3 Analysis Of Cash Flow For A Small Business

Decision Case 2-3 Analysis of Cash Flow for a Small BusinessCharles, a financial consultant, has been self-employed for two years. His list of clients has grown, and he is earning a reputation as a shrewd investor. Charles rents a small office, uses the pool sec- retarial services, and has purchased a car that he is depreciating over three years. The following income statements cover Charles’s first two years of business: Year 1 Year 2Commissions revenue$ 25,000$65,000Rent$ 12,000$12,000Secretarial services3,0009,000Car expenses, gas, insurance6,0006,500Depreciation15,00015,000Net income$(11,000)$22,500Charles believes that he should earn more than $11,500 for working very hard for two years. He is thinking about going to work for an investment firm where he can earn $40,000 per year. What would you advise Charles to do?

Order Now