DePaul University Massachusetts Stove Company Strategy Case Analysis
Description
Case 10.2: Massachusetts Stove Company: Analyzing Strategic Options
REQUIRED:
a. Identify clues from the financial statements and financial statement ratios for Year 3Year 7 that might suggest that Massachusetts Stove Company is a mature business.
b. Design an excel spreadsheet for the preparation of projected income statements, balancesheets, and statements of cash flows for MSC for Year 8Year 12. Also forecast thefinancial statements for each of these years under three scenarios: (1) best case, (2)most likely, and (3) worst case. The following sections describe the assumptions youcan make.
c. Calculate the financial statement ratios listed in Exhibit 10.16 for MSC under eachof the three scenarios for Year 8Year 12. Note: You should create a fourth spreadsheet as part of your preparation of theprojected financial statements that will compute the financial ratios.
d. What advice would you give the management of MSC regarding its decision toenter the gas stove market? Your recommendation should consider theprofitability and risks of this action as well as other factors you deem relevant.
(I put together attachments you may find useful and eliminate some of the confusion on the loan part and interest expense. Including the full Case 10.2: Massachusetts Stove Company: Analyzing Strategic Options below.)
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