finance-You’re the sole owner of Duarte Spring Company

QUESTION

1. You’re the sole owner
of Duarte Spring Company; you paid $200K for the business when you acquired the
firm five years ago. Duarte is a manufacturer of high-end springs used by major
aerospace and aircraft manufacturing companies. Six months ago, you completed
your largest project to date–a $500,000 order delivered to Boeing Corporation.
Regrettably, you just received notice from Boeing’s lawyers reporting that they
incurred a $50 million loss because your part failed and forced Boeing to miss
key delivery dates of its new jumbo jet for customers. What is the dollar
amount your personal loss exposure if Duarte Spring Company is a) a sole
proprietorship, and b) if it is a C-Corporation, and explain why?

2.
Differentiate among the three components of a sound business model; describe
each component in detail, and then explain how they work together to provide a
sound business model.

3. Which statements best define
the concept of a cash budget?

The
statement of cash flows
A
venture’s projected cash receipts and disbursements over a forecast
period
The
income statement using accrual accounting according to GAAP guidelines
Management’s
one year forecast identifying sources and uses of cash
Statement
of Retained Earnings

ANSWER:

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