Finance and Accounting Term Paper Example | Topics and Well Written Essays - 4000 words

Finance and Accounting - Term Paper ExampleSwissChoc SA (owned by a family friend) is wide-awake to give him exclusive rights to sell their products in the USA for a ten year period in return for an upfront payment. The distributor is an independent selling agent who has a contract to sell the products of a manufacturer. The distributor cannot represent him- or herself as the producer but may display the producers trade stir in signage and in the sales situation (US Legal, 2012). Since the information provided is not adequate, we have to make certain likely assumptions while working out the statements required in this respect. However, the lack of details in these aras is not materially going to affect the reliability of the statements. The assumptions made in this connection have been stated in the tale to enable the user to bring in additional details, if it is felt necessary to have a more(prenominal) detailed report on the project. There is uncertainty in the value front as the details accustomed with regard to prices at which the product could be sold are not specific. Instead George has given a price range with minimum and maximum prices for the products to be marketed. There are intemperateies in predicting the place prices due to interplay of the brands, price levels (cheap and costly with various price levels in between), market segments, tastes and flavors. Therefore, sensitivity analysis has been undertaken to set off impacts due to variations in price realization with justifications for adopting a particular method for working out the comely upfront fee payable to the manufacturer supplier SwissChoc SA and the return on investment that could be judge from the note venture of George. Cash flow statement for the first year of operations In The dictation I, Cash flow statement for the first year of the operations of Mr. George, while considering various factors contributing to the capital flow, both in flow and out flow we have made certain assumptions after guardedly considering various implications related to the business. Sale Price The sale price is considered at $ 135 per kilogram of the chocolate. This is the blind drunk price as per the price range given by George adopt for the purpose of our calculations. The mean price is worked out as below. Highest price = $ 150 Lowest price = $ 120 Average price adopted for calculation = (Highest price + Lowest price)/2 or (150 + 120) / 2 = 135. The chocolates are consumed mostly by the college and shoal going students. If the tastes and flavors are acceptable to them pricing is not going to be a prohibiting factor in taking a buying decision by them. Since George is an experienced person with business school scope along with his wife, his price estimates should be realistic. Moreover, the Swiss made chocolates are reputed for their taste and quality. Therefore, there will not be any resistance from the parents for their children eating these chocolates. The pr ice comparison for this product would be very difficult as in the case of other fast moving consumer goods with different brands and varieties. The Georges internet business model by marketing completely through credit cards means that the people targeted are high end and sophisticated customers, where the quality and service are more important rather than the price. Therefore, adopting the mediocre price, if not the highest price would be very reasonable. Capital account of George The amount shown under capital