Case ID: 9A89B035
Solution ID: 13687
Words: 1211
Price $ 75

Gourmet Gadgets Inc

Case Solution

This report analyzes the feasibility analysis of Gourmet Gadgets for producing and marketing a new invention, pasta server. Gourmet Gadget Inc. is a startup that seeks a venture capitalist for additional funding to start its operations. We have constructed a complete master budgeting system for the company, starting from sales budget to projected balance sheet. We have found that the company will need $85,000 for smooth functioning including expansion of production facility. Based on the above mentioned figures and an analysis of the master budget, we suggest that the company should go for 50% ownership stake and receive $75,000 from Mr. Cohen. By the tenth month i.e. May 1990, however, they will need cash of $8,663 to fund the purchase of two-cavity production mould. Nevertheless, the decrease in production costs due to the new mould increases the profitability as well as cash position of the company.

Excel Calculations

·         Master Budget Base Case

·         Master Budget Pessimistic Case

·         Composition of Canadian Households                                                                                  

·         Balance Sheet as of July 15, 1989

·         Lanzetta's Personal Balance Sheet as of July 15, 1989

·         Production Schedule (in units) (10000 units/month sales)

Questions Covered

1.      Executive Summary

2.      Case Introduction:

3.      Master Budget:

4.      Sales Budget  

5.      Production Budget

6.      Operating Expenses

7.      Capital Expenditures

8.      Budgeted Income Statement

9.      Cash Budget

10.  Budgeted Balance Sheet

11.  Conclusion:

12.  Master Budgeting System for Base Case