TechNova Inc. is a fictional technology company founded in 2010. It specializes in developing innovative software solutions for businesses, with a focus on artificial intelligence and machine learning applications. The company has experienced rapid growth over the past decade, expanding its operations globally and continuously investing in research and development.
Key Facts:
TechNova Inc. has been known for its aggressive growth strategy, which includes both organic expansion and strategic acquisitions. The company went public in 2015 and has since been closely watched by investors for its financial performance and technological advancements.
| Item | Amount (in thousands $) |
|---|---|
| Revenue | 500,000 |
| Cost of Revenue | (300,000) |
| Gross Profit | 200,000 |
| Operating Expenses | (150,000) |
| Operating Income | 50,000 |
| Interest Expense | (5,000) |
| Income Before Taxes | 45,000 |
| Income Tax Expense | (11,250) |
| Net Income | 33,750 |
| Item | Amount (in thousands $) |
|---|---|
| Cash and Cash Equivalents | 100,000 |
| Accounts Receivable | 80,000 |
| Inventory | 40,000 |
| Total Current Assets | 220,000 |
| Property, Plant, and Equipment | 200,000 |
| Intangible Assets | 100,000 |
| Total Assets | 520,000 |
| Accounts Payable | 50,000 |
| Short-term Debt | 30,000 |
| Total Current Liabilities | 80,000 |
| Long-term Debt | 120,000 |
| Total Liabilities | 200,000 |
| Shareholders' Equity | 320,000 |
| Total Liabilities and Equity | 520,000 |
| Item | Amount (in thousands $) |
|---|---|
| Net Income | 33,750 |
| Depreciation and Amortization | 20,000 |
| Changes in Working Capital | (10,000) |
| Cash from Operating Activities | 43,750 |
| Capital Expenditures | (30,000) |
| Cash from Investing Activities | (30,000) |
| Debt Repayment | (15,000) |
| Dividends Paid | (5,000) |
| Cash from Financing Activities | (20,000) |
| Net Increase in Cash | -6,250 |
| Item | Amount (in thousands $) |
|---|---|
| Revenue | 480,000 |
| Cost of Revenue | (264,000) |
| Gross Profit | 216,000 |
| Operating Expenses | (172,800) |
| Operating Income | 43,200 |
| Interest Expense | (3,000) |
| Income Before Taxes | 40,200 |
| Income Tax Expense | (10,050) |
| Net Income | 30,150 |
| Item | Amount (in thousands $) |
|---|---|
| Cash and Cash Equivalents | 120,000 |
| Accounts Receivable | 70,000 |
| Inventory | 35,000 |
| Total Current Assets | 225,000 |
| Property, Plant, and Equipment | 180,000 |
| Intangible Assets | 90,000 |
| Total Assets | 495,000 |
| Accounts Payable | 45,000 |
| Short-term Debt | 20,000 |
| Total Current Liabilities | 65,000 |
| Long-term Debt | 100,000 |
| Total Liabilities | 165,000 |
| Shareholders' Equity | 330,000 |
| Total Liabilities and Equity | 495,000 |
| Item | Amount (in thousands $) |
|---|---|
| Net Income | 30,150 |
| Depreciation and Amortization | 18,000 |
| Changes in Working Capital | 5,000 |
| Cash from Operating Activities | 53,150 |
| Capital Expenditures | (25,000) |
| Cash from Investing Activities | (25,000) |
| Debt Repayment | (10,000) |
| Dividends Paid | (3,000) |
| Cash from Financing Activities | (13,000) |
| Net Increase in Cash | 15,150 |
| Item | Scenario A | Scenario B | Variance | % Var |
|---|
Based on your analysis of the financial statements for Scenarios A and B, which scenario represents a better financial situation for TechNova Inc.?