CASE FILE #2026-HRT-001

Final Accounts:
What Killed Hartley's?

AQA A-Level Business (2026) | 3.1.4 Financial management

THE CASE

Hartley's Home & Garden - a trusted British retailer for over 40 years - has collapsed. 180 staff have lost their jobs.

The newspapers blame online competition. Former staff blame bad luck and rising costs. The CEO blames a minor social media backlash. The rest of the Board blame each other.

But businesses don't just die. Something killed Hartley's. And the cause is hidden in the accounts.

Your job: Examine the financial statements. Calculate the ratios. Unlock the evidence. Find the real cause of death.

Remember: ratios reveal the impact of decisions — but not why those decisions were made. You'll need the evidence for that.

EVIDENCE
0/8
FINANCIAL STATEMENTS — THIS YEAR
Calculate ratios for This Year to unlock evidence and historical comparisons.
HARTLEY'S HOME & GARDEN LTD
Statement of Comprehensive Income — Year ended 31 March (£'000)
Revenue 28,500
Less: Cost of sales 19,950
Gross profit 8,550
Less: Operating expenses 7,400
Operating profit 1,150
Less: Interest payable 980
Profit before tax 170
HARTLEY'S HOME & GARDEN LTD
Statement of Financial Position — As at 31 March (£'000)
NON-CURRENT ASSETS
Property, plant & equipment 12,400
12,400
CURRENT ASSETS
Inventories 6,800
Trade receivables 1,200
Cash 180
8,180
LESS: CURRENT LIABILITIES
Trade payables 5,600
Other payables 2,200
7,800
Net current assets 380
LESS: NON-CURRENT LIABILITIES
Long-term bank loan 7,200
NET ASSETS 5,580
FINANCED BY
Share capital 2,000
Retained earnings 3,580
TOTAL EQUITY 5,580
💡 Tip: Most sales were cash or card payments from retail customers. The small trade receivables balance relates to a few business account customers. For payables days, use cost of sales as an approximation for credit purchases.
PROFITABILITY 0/2
Gross profit margin ○
Net profit margin ○
LIQUIDITY 0/2
Current ratio ○
Acid test ratio ○
EFFICIENCY 0/3
Inventory turnover ○
Payables days ○
Receivables days ○
GEARING 0/1
Gearing ratio ○

Ratio Name

Formula here