Analysing the performance of business year 1

From Virbus

The business year 1 is now over.

Nice work! However, before you can finally close the business year you still have to answer one quiz which shows you how much you have learnt. Please find the quiz here http://www.virbusgame.eu/quiz/round7.php

To some degree or other, all interested parties will ask you questions about financial information. Your answers to these questions will come from a careful analytical review of the financial information contained in the Profit and Loss Statement, the Balance Sheet and the calculation of significant ratios between figures in the accounts.

Please analyse your performance according to the following categories:

Profitability

Is the business making a profit? Is the profit high enough?

Efficiency

Is your business making the best use of its resources?

Is it generating adequate sales from its investment in equipment and people?

Is it managing its working capital properly?

Liquidity

Is the business able to meet its short-term obligations as they fall due from the cash resources immediately available to it?

Stability

What is the overall structure of the business's finance - does it place a burden on the business?

What are the prospects of the hotel in the long term?

Is the business generating sufficient resources to repay long-term liabilities and re-invest in required modernisations?

Investment Return

What return can your investors expect to get out of your hotel?

How does this compare with similar, alternative investments in other businesses?

Now you have successfully completed Phase I. You may now proceed on to Phase II.