ACCOUNTING AND FINANCIAL SERVICES

Accounting and Financial Services



Accounting and financial services

Introduction of Jool's Furniture Industry

Julius Smith-Brown founded Jool's Furniture in West Yorkshire in 1990 as a sales operation specializing in goods made by local companies. In 1995, Smith-Brown invested in the Huddersfield-based Sandy Furniture, manufacturers specialising in kitchen and bedroom furniture for major retailers. By the year 2005 the enlarged company offered a line of roughly 150 different furniture products, and had focused all its design and manufacturing toward middle and higher-income buyers. The company's growing customer network included wholesalers, mass-retailers and smaller retailers. Later developments involved the creation of an office supplies division (wholesale, rather than manufacturing) and the development of a quality products division (echoing the 'local' and high-income nature of the company's roots).

The enlarged business now consists of four major divisions (Kitchen, Bedroom, Quality and Office) employing over 500 people. The company has received offers to take the company public, but Smith-Brown prefers to keep it under local control. Control, however, is a word that Smith-Brown uses loosely - he has always been a strong believer in a laissez-faire form of management where divisional controllers are given free rein to manage as they see fit - subject only to the achievement of a target return on investment of 10%. This principle has been severely challenged in the recent past, however, as the company has suffered the effects of a strong growth in imports, particularly from China and Poland - imports now account for 42% of the total UK market (up from 15% ten years ago).

Q. no.1

Present Financial Situation of the Company

Jool's current financial position is much stable in reference to its previous years whereas in some division some sectors are still lacking behind its competitive market such as Quality division product which was in loss in year 2007, where as the company's other division were still in good working position. Jool's office division is working as a best as compare to the other division with the highest earning profit for the year 2009 for the company with profit and return of $ 302,335, for its Bedroom division for the year 2009 the unit earned $ 189,000 which is slightly as compared the same unit last year which was $ 204,316. For Jool's current position of Quality Product division which is progressing in positive numbers with 2009 profit for the year was $ 188,601, which was in loss for the year 2007. Company's Kitchen division has also played a key role for the entire group with an earning profit for the year 2009 which was $ 194,412.

Overall, Jool's industry financial position shows the company is in very good condition as it has some of its division who are working in rationally good and positive numbers such as Jool's office division and quality division department.

Ratios and Analysis

For Quality Product Division

Gross Profit Margin

It is the calculation of financial health of a company through its profit in terms of sale.

(Gross Profit/Sales x ...