# Currently, you and your future business partners are debating whether to focus Auto-Mart on a "do-it-yourslf" or "do-it-for-me" business. A do-it-yourself

Currently, you and your future business partners are debating whether to focus Auto-Mart on a “do-it-yourslf” or “do-it-for-me” business. A do-it-yourself business emphasizes the sale of retail auto parts that customers will use themselves to repair and service their cars it-for-me business emphasizes the offering of maintenance and service for customers 1. In groups of three or four, discuss whether to implement a do-it-yourself or do-it-for-me ng nationwide within five years business emphasis. List the advantages of each emphasis, and arrive at a con which emphasis to implement. 2. Provide examples of real-world businesses that use do it-yourself or doit- for-me at conclusion as to emphases do-it-for-me business Case 3-4 Accrual versus cash net income. Cigna Corp. (CI) provides insurance services, and Deere & Company (DE) manufactures and sells farm and construction equipment. The following data (in millions) were adapted from recent financial statements of each company. Cigna Deere Net income (accrual basis Cash flows from operating activities Depreciation \$2,102 1,994 588 \$1,940 3,740 1,382 1. Compute the difference between cash flows from operating activities and net income. 2. Express the difference in (1) as a percent of accrual net income. Round to one decimal place. 3. Which company’s accrual based net income is closer to what would be reported if the company used the cash basis? Why?

Net income(Cash basis)+Depreciation=Cash flow from operating activites
1)Cigna=1994-2102=108
Deere=3740-1940=1800
2)Cigna=108/2102=5.14%
Deere=1800/1940=92.78%
3)Net income(Cash basis) for Cigna=1994-558=1436
Net income(Cash basis) for CDeere=3740-1382=2358
I Cigna=2102-1436=666
Deere=2358-1940=418
It is closer for Deere

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