My dad came across the Financial Statements of his dad's business from April 1946. I scanned a page of it to the right. The way QuickBooks currently prints a Profit and Loss Statement, you have the Revenue at the top and then Costs of Goods, then Expenses and finally the Profit at the bottom, but this statement has all the Expenses, then the Revenue THEN the Profit.
The numbers are interesting. As you could guess, it is a bar, a few blocks away from Wrigley Field. In 1946 the average family income was about $2,600 per year or $216.66 per month. The profit for this month was $155.78. Previous month's profits averaged $670.
Why was this month so low? As I looked at the details of the financials, I saw that he bought additional beer this month. Maybe there was a deal, or added a new brand.
Having monthly financial statements are important for a business. They answer questions you might have. Can you take advantage of a suppliers' deal? Will purchasing equipment be a better advantage this month or next?
What is your business worth? I did a quick Valuation of my Grandfather's business, based on the financials we found. At the beginning of 1946, it would be worth about $28,140. In June 1946, it would be worth over $40,000. What do you think a major factor was in the increase in the business value in those first 6 months of 1946? (Hint: When was the last time the Cubs were in the World Series?)
The numbers are interesting. As you could guess, it is a bar, a few blocks away from Wrigley Field. In 1946 the average family income was about $2,600 per year or $216.66 per month. The profit for this month was $155.78. Previous month's profits averaged $670.
Why was this month so low? As I looked at the details of the financials, I saw that he bought additional beer this month. Maybe there was a deal, or added a new brand.
Having monthly financial statements are important for a business. They answer questions you might have. Can you take advantage of a suppliers' deal? Will purchasing equipment be a better advantage this month or next?
What is your business worth? I did a quick Valuation of my Grandfather's business, based on the financials we found. At the beginning of 1946, it would be worth about $28,140. In June 1946, it would be worth over $40,000. What do you think a major factor was in the increase in the business value in those first 6 months of 1946? (Hint: When was the last time the Cubs were in the World Series?)
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