Business Ethics

Alex and Pat are new business owners; they are determined to create a local coffee shop that has sparked interests between the two because Alex has been part of coffee-roasting club for several years. Alex is a chef by education and currently works part-time at a local bakery that produces Italian cuisine-inspired goodies; Pat is a marketing manager at an advertising firm. Both Alex and Pat are eager to work full-time in the new shop with part-time staff for extra help.

There a few things that Alex and Pat must take into account to start-up the business. Furniture and fixtures must be applicable in the business; the ideal cost maybe a costly, but once these are added they will remain so long as the two keep tabs of the amount paid for the furniture, lighting, and extras. Secondly, equipment has to be purchased; Alex and Pat would like to have coffee and espresso machines, refrigerators, stove, ovens, cooking and baking equipment, and electronic appliances (blenders, food processors, etc.). I think these items will be the most costly, but once again these are beneficial asset the business will need. The third requirement which will develop over a three year basis is the building or expansion procedure. Alex and Pat have decided that one goal they have is to expand over three years to open a second coffee shop that can compete more directly with the Starbucks shop that is three miles away. The expansion project will possibly be even more costly than the equipment and assets combined. Over a three year span the two will probably have enough to expand, but they must account for the total depreciation of the buildings (less costly) and the land itself. Leases or renting anything Pat and Alex have listed will probably affect their liabilities (what is owed), but if these asset are purchased within the amount contributed at the start-up of the business they may be better off when it boils down to what is theirs (assets).

In determining Alex and Pats’ future funding...