Mountainarious Sporting Financial Analysis

INTRODUCTION

Mountanarious Sporting Co. a well-reputed store owned by a sole-owner Steve Donne that has been a high-end specialty seller of branded, exclusive sporting goods and merchandise for the past 11 years.
Steven Donnie had always been a fanatic in the field of sports. Donnie as an owner is well-versed in customer-service and product knowledge, expertise in setting his store according to the latest needs and had a great personality.
The MSC has always been a popular store at Barron, Ontario and also with the local sports community and organizations, local gyms coaches and running clubs by promoting the merchandise available in the store by Donnie.
With the emergence of new stores like big-box retailers, specialty/boutique and online

Here we are making a business report which evaluates the performance of Mountainarious Sporting Co. to take loan from Canadian Commercial Bank. With the given basic financial reports by the company we have used few methods of analysis which includes horizontal, vertical and trend analysis as well as ratios such as Debt, Current, Acid Test and Asset Turnover ratios. We also used other ratios such as Return of Total Assets, Return on Equity , net profit margin and so forth. All the calculations of the above are found in the appendices.

Horizontal and vertical analysis

The Financial Statement analyses how sales are increasing and whether the sales are reasonable for the

The gross profit continuously increased with the introduction of soft goods in the store although the merchandise found in the store next door affected his sales considerably. Company’s gross profit was 28.73% of net-sales in 2003 and it increased by 3.12% of net sales in 2007.
(Sales and Gross Profit Diagram)
The company’s total operating expenses continuously raised from 2003-2007 with a considerable fall of 16.33% in 2005 the reason being theas the loans payable rapid growth of Internet-Sales as the company had their own website for online ordering which reduced the company’s wages, amortization, vehicle and miscellaneous expenses. In 2003 the cost of Total Operating expenses was 32.50% of the net-sales which was decreased by 5.24% in 2007 net-sales.
The company’s Net Income faced a loss in the year 2003 and 2004 due to the fire accident and the re-establishment of his store in the new location. The profit in Net Income increased in 2005 and 2006 as he introduced soft goods and also with promotion of his store with the local gyms and running clubs. There was a loss again in 2007 Net Income as the company required a new strategy to develop the sales of soft goods as there were strong competitors. The company net-sales faced Net Loss of 0.81% in 2003 and Net income of 2.60% in