Thank you for allowing our firm to assess the financial position of your business. After many thorough assessments and considerations, we have come to a conclusion that you would best benefit from the business if you sell it. .
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Judging from the assets and liabilities information that you've provided us with, your business is currently worth $75,700 (calculated from $138,200 worth of assets and $62,500 of liabilities). However, most of your assets have depreciated in value over the years of operating in the business, especially the two trucks that are over five years old. Therefore, in reality, your assets are not worth as much as they used to be. As well, your company has quite a large amount of debts. In fact, you only have possession of approximately 55% of your business, which is not a very ideal situation to be in if you are the owner of a business. .
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During the assessment process, we also realized that your company has hired a few employees to keep the business running efficiently. For that, we've prepared an estimate of salaries for each employee, which can further assist us in calculating your expenses versus revenue. Assuming that each of your truck drivers receives $50,000 per year, the amount that you spend on the salaries of the drivers is a total of $100,000 annually. In addition, our firm has anticipated that you would pay your clerk and service repairperson nearly $30,000 and $40,000 per annum respectively. And during the busy seasons, you may spend as much as $24,000 per year on the salaries of part-time workers. Thus, your expense on salaries comes to a grand total of $194,000. On the other hand, the only source of revenue of your company is derived from the contracts to supply fuel to 200 customers, with the average purchase of each customer being $600. As a result, the total revenue of the business is $120,000. With total revenue of only $120,000 and total expenses of at least $194,000, your company will experience a net loss of $74,000 annually.