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Finance Concept

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Accounting | O’Henry’s data services | Accounting | | Lorine Reed | 10/17/2010 |

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The trail balance unreported expenses is $2,750 and the revenue is $2,100 ,So the revenue for November was $14,300plus $2,100 which equals $16,400. Expense $3,400 and $900 plus the unreported $2750.00 the total amount is $7,050. $16,400 minus $7050 equals $9350 times 12 equals $112,200. To pay 20 times that amount is $187,000.I added $2,100 revenue and $2,750 expense. Benjamin O Henry’s revenue is $16,400 and the total expense are $7050.00. When I subtracted the expense of $7050 from the revenue $16,400 the net income was $9350.If I were to purchase Benjamin O Henry’s business the amounts of revenue would stay the same. My expenses would be a additional $3000.00 for managers salary. My total expenses would be $10,050. When subtracting my expenses from my revenue my net income would be $16,400.

The most I will pay for the business is 20 times the monthly net income.20 times $6350 which equals $127,000. Benjamin O Henry will take no least than his ending capital of $144,750. There is a $17,750 difference than what I would offer. I would talk to Mr. Henry to see if we could work something out or ask him if he would be willing to lower the sales price for the business. I would offer him $130.575 for the business and hope we could come into a agreement.

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