6.1Case studies
The essentials in 30 seconds
- Combine: a real case mobilizes the whole chain — reading the balance sheet and income, separating result from cash, calculating a cost, a break-even point, a ratio, anticipating the cash need.
- Order: understand the accounts first, cost next (cost, margin, break-even), decide last on anticipated cash.
- Reflex: faced with a financial decision, replay the levels' sequence in order instead of deciding by gut.
Rachid thread — 1 year on: two decisions that hold up
One year after levels 0 to 5, Rachid re-reads his two landmark files: the month his profitable company almost ran out of cash in full growth, and the launch of his new product whose price was set by calculation rather than feeling. Both cases below reuse his sequence: balance sheet and income read, WCR measured, costs and break-even calculated, cash anticipated.
Each case follows Context → Steps → Result: replay it with your figures.
Why concrete cases
The previous levels laid the bricks; here we assemble them end to end. It is the sequence of good reflexes — reading the balance sheet and the income statement, distinguishing result and cash, calculating a cost, a break-even point, a ratio, anticipating a cash need — that sets an informed decision apart from a costly mistake.
Case 1 — A profitable SME short of cash
Context: A fast-growing company shows handsome profits, but the manager struggles to pay suppliers and salaries at the end of the month.
Déroulé :
- Distinguish result (accounting profit) and cash (real cash): the two do not match (L5.5, L3.3).
- Calculate WCR = inventories + customer receivables − supplier payables and see that it has exploded with the growth (L3.3).
- Map working capital and cash (Cash = Working capital − WCR) to locate the tension (L3.3).
- Act on the WCR: speed up customer collections, optimise inventories, negotiate supplier terms (L3.3).
- Build a month-by-month cash plan to anticipate the upcoming gaps (L3.5).
- Size a possible short-term financing and present it to the banker with the forecast (L3.5).
Result: The manager understands the “bankruptcy by growth”, manages his WCR and secures his cash — without sacrificing profitability.
Case 2 — Pricing a new product
Context: A manager wants to launch a product and make sure it will be profitable, without selling at a loss or setting a deterrent price.
Déroulé :
- Distinguish fixed and variable costs to reason in contribution margin on variable costs (L3.4).
- Calculate the full cost (direct + allocated indirect costs) for a price that covers everything (L4.1).
- Stay aware that the allocation key of indirect costs strongly influences the cost obtained (L4.1).
- Calculate the break-even point = fixed costs / contribution margin on variable costs (L3.4).
- Simulate: at what volume does the product become profitable? what happens if we lower the price by 5%? (L3.4).
- Check the VAT impact (price excl./incl. tax) and anticipate the corporate income tax generated (L1.4, L5.1).
Result: A price that covers the costs and yields a margin, a quantified minimum sales target, and a decision based on facts rather than intuition.
Ready-to-say script — framing your decision before costing (1 min)
“Before deciding: have I read the balance sheet and the income statement? have I separated profit from cash? which cost, which margin, which break-even? what impact on cash and WCR? I write these five lines first, then I cost.”
Copy-paste template — replayable case sheet
DECISION to take (price, investment, financing, hire): ...
READING of the accounts (balance sheet, income, ratios): ...
RESULT vs CASH (WCR, working capital, cash plan): ...
COSTING (cost, margin, break-even, NPV/IRR if investment): ...
TAX and anticipated deadlines (VAT, tax, terms): ...
Guide REFERENCES (L0 → L5): ...
Expected RESULT (decision and tracking indicator): ...Small business / tight budget
One case at a time, on one page: context in 2 lines, 5 steps, result in 1 sentence.
Algeria SME
Include real customer collection times and local cash constraints in the sequence: closely tracked cash plan, tax and social deadlines anticipated with the chartered accountant.
Remote / hybrid
Double traceability at a distance: costed assumptions written before deciding, forecast variances shared after.
Cross-cultural
Check the country's accounting and tax rules before transposing a case: a sound set-up here may be non-compliant elsewhere.
48h challenge — apply tomorrow
Take 1 real financial decision (price, expense, financing) and write its 5-step sequence. Test the 1st step this week.
- I can chain the reflexes in the right order on a real case.
- I have a replayable case sheet for my next decision.
- I did the 48h challenge or scheduled its date.
Rachid's company shows handsome profits but he struggles to pay salaries. Which sequence follows the guide?