Hanson Ski makes brilliant ski gear in Colorado. Hanson works in an emphatically developing top of the line section of the business sector, and is among the ten biggest firms when measured by incomes. The way of the business is very occasional in nature. Orders for ski hardware are typically assumed control summer season (March to July), though shipments occur from ahead of schedule fall till December. The organization fabricates the hardware consistently and as a rule conveys a lot of stock amid off-season periods. Additionally, the deals are made using a loan and the credit terms are in accordance with the business tradition of upto three months. In this manner, the organization conveys a high measure of current resources amid the period going from September to November. Naturally, the organization needs to fund this working capital through some type of financing.
Hanson Ski Products - Yearly Balance Sheets
Yearly and Projected
Denny Hanson was particularly concerned that the stockholder loans be paid off in November1986 when they were due, and he asked Dave Snyder, treasurer, to prepare a cash budget by months for the third quarter of FY 1987 (Exhibit 5). Do you see any problems in paying off the loans on time?What could Hanson do to be sure the loans can be paid?