Getting Screwed

Jerry Luft had been friends with Mark Stoneman for as long as he could remember. Their parents had been friends and they grew up together. The only time they didn’t keep in touch was when they went to study at different Universities on different coasts.

A few years after graduation they decided to go into business together. They invested in a brand ‘’LYL Live Your Life’’ and slowly started to create different products. The lines grew and became very popular with people who enjoyed leisurewear. Next, they created an isometric product to build muscles and help with toning the body. It went gangbusters.

Jerry lived in a comfortable twenty-five hundred square foot home, while his partner Mark had a seven thousand square foot place. Jerry drove a Toyota Camry SXE while Mark tooled around in a Masserati.

The truth of the matter was Jerry spent all his time on the creative side while Mark looked after sales and accounting. He was the one who always liaised with their mutual friend and accountant Dave Eisentrat.

When Covid-19 showed up on the scene they were forced to change their strategies and they looked to social media for success. Whenever Jerry talked to Eisentrat he would reassure him that things were fine, even though cash flow was being depleted quickly. ‘’You know, this problem with no shoppers in stores has led to a decrease in inventory being shipped and sold, and our fixed costs remain the same. Even though there is a decline in business and margins are being chopped you are still in good shape. You know Jerry, there are some long term customers who are on shaky ground. This Covid virus has been a killer, but you and Mark will be okay. I mean you are going to have a bigger tax bill this year, but things will be alright. Oh, Mark told me that he’s going to cancel a couple of contracts with manufacturers in Sri Lanka till demand rises again, that should help you.’’

After the conversation ended, something didn’t feel right. When Jerry called Mark, he told him to relax he had everything under control. The business would be fine. It was supposed to be reassuring but instead, it made him more nervous.

Since he had started in business with Mark, Jerry had done something he had never discussed, he kept his own personal handwritten ledgers about orders and shipments. He…