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Space Wheel Essay

1. In order to consider how the conversion process in the company would work, let recall the main activity of the company. The company is dealing with providing cars for long and short-term lease. Therefore in order to operate in this business, we need a warehouse where our old and new cars would be keeping. Also, we need office space in the centre of a city, where the customers may conclude the contracts and get all the necessary information. Also, there would be a separate office for an accountant, where they can deal with money and a lot of financial statements.

The conversion process in the “Space Wheels” would be represented by following stages: The office manager introduces the services of the company, and then the clients decided after some period of time to conclude the contract and to receive usual services. The cars that the “Space Wheels” possess at the day of setting up would be held in the warehouse. Every morning the driver will have to pick up the car and to go to the customer.

The monthly payment is required to be made by the customer. These payments can be done in tenge or in dollars, but according to our plan, all prices are in dollars. According however to the “Law on Currency” the financial statements have to be made in tenge equivalent. Therefore, all amounts and the financial ratios would be presented in dollars and tenge for external use and only in tenge for state agencies.

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The office space, the warehouse and other necessary space for working would be rented thus, there will not be presented any property account in the balance sheet. The only valuable property of the company would be the cars that the company acquiring during the whole existing life of the company.

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We, as Managers, have decided that the free cash from profit would go to not to invest in the securities, but to purchase the cars. The security market in Kazakhstan is not well developed and there is no secondary market for some securities, therefore, it would be risky to invest the profit in the securities. Therefore, we would invest in the purchasing of fixed assets, like cars.

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Space Wheel Essay. (2021, Feb 07). Retrieved September 22, 2021, from https://essayscollector.com/essays/space-wheel/