1 What was the accounts receivable turnover for year 8 2 Year 9 accounts receivable turnover is projected to the same as year 8 What is the projection for average accounts receivable 3 What is the projection for accounts receivable for the end of the year for year 9 4 Would cash be generated by accounts receivable or needed to fund accounts receivable And, by how much 5 If accounts payable is projected to remain the same proportion to sales revenue as year 8, what is the projection for accounts payable for the end year 9 6 Would cash be generated by accounts payable or needed to fund accounts payable And, by how much Year 6 Year 7 Year 8 Year 9 Operating Activities Net Income $741,867 $1,334,438 $1,491,027 $13,628,412 Depreciation 400,000 400,000 400,000 Other non cash expenses 145,000 175,000 179,000 0 Increase in accounts receivable 350,000 300,000 700,000 2,500,000 Increase in inventories 50,000 50,000 70,000 520,000 Increase decrease in accounts payable 100,000 200,000 0 Subtotal Net cash provided by operating activities 786,867 1,359,438 1,300,027 16,648,412 Long term Investing Activities Purchase or sale of fixed assets 0 0 0 0 Subtotal Net cash used in investing activities 0 0 0 0 Financing Activities Decrease in notes payable 400,000 400,000 400,000 Increase decrease in bonds outstanding 0 0 0 0 Payment of dividends to stockholders 0 0 0 0 Sale or repurchase of stock 0 0 0 0 Subtotal Net cash provided by financing activities 400,000 400,000 400,000 0 Summary Net increase in cash 386,867 959,438 900,027 16,648,412 Cash and equivalents at the beginning of the year 1,500,000 1,886,867 2,846,306 3,746,332 Total Cash and equivalents at the end of the year $1,886,867 $2,846,306 $3,746,332 $20,394,744 ear Cash Short Term Securities Accounts Recervable Inventory $1,886 867 21 00 $2,846 306 28 76 $3,746,332 3355 $0 20,394,744 00096 100 00 0 00 0 00 1,500,000 16 69 1 800 000 18,19 2,500,000 22 39 520,000 466 400 000 4 45 3,786,867 2 42 14 5200000 57 86 $8986 867 100 00 450 000 4 55 5096 3056 51 50 4,800,000 48 50 $9896 306 100 00 Total Current Assets 6 766 332 6060 20 394 744 100 00 Fixed Assets 4,400,000 39 40 0 00 Total Assets (3) 1 $11 166 332 100 00 $20 394 744 100 00 Cost Cost 0 00 ) Accounts Payable $1,000,000 11 13 ) 0 00 0 00 0009 $800,000 7 16 0 00 0 00 000 0 00 Note Payable Bank Total Liabilities 3200 000 4,200,000 35 61 ) 3 72 , 1 32 ) 2 800 000 28 29 ) 3 72 1 05 2 3,200,000 2866 000 21 49 3 72 ) 0 80 0 00 , 372 0 00 46 73 53 27 23 84 , 1270 100 0096 3,600,000 6,296,306 $9,890 300 36 38 63 62 100 00 0 00 100 00 100 00 Equity 4,786 867 23 0296 1465 7966332 7134 , 22 149 15 8096 20,394,744 154490 15 44 Total Liabes Equity 8 98655 $11,166,332 100 00 $20394144 WACC on total invested capital

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1. What was the accounts receivable turnover for year 8? 2. Year 9 accounts receivable turnover is projected to the same as year 8. What

1. What was the accounts receivable turnover for year 8?

2. Year 9 accounts receivable turnover is projected to the same as year 8. What is the projection for average accounts receivable?

3. What is the projection for accounts receivable for the end of the year for year 9?

4. Would cash be generated by accounts receivable or needed to fund accounts receivable? And, by how much?

5. If accounts payable is projected to remain the same proportion to sales revenue as year 8, what is the projection for accounts payable for the end year 9?

6. Would cash be generated by accounts payable or needed to fund accounts payable? And, by how much?

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	Year 6	Year 7	Year 8	Year 9
Operating Activities
Net Income	$741,867	$1,334,438	$1,491,027	$13,628,412
Depreciation	400,000	400,000	400,000
Other non-cash expenses	145,000	175,000	179,000	0
Increase in accounts receivable	-350,000	-300,000	-700,000	2,500,000
Increase in inventories	-50,000	-50,000	-70,000	520,000
Increase/decrease in accounts payable	-100,000	-200,000	0
Subtotal - Net cash provided by operating activities	786,867	1,359,438	1,300,027	16,648,412

Long-term Investing Activities
Purchase or sale of fixed assets	0	0	0	0
Subtotal - Net cash used in investing activities	0	0	0	0

Financing Activities
Decrease in notes payable	-400,000	-400,000	-400,000
Increase/decrease in bonds outstanding	0	0	0	0
Payment of dividends to stockholders	0	0	0	0
Sale or repurchase of stock	0	0	0	0
Subtotal - Net cash provided by financing activities	-400,000	-400,000	-400,000	0

Summary
Net increase in cash	386,867	959,438	900,027	16,648,412
Cash and equivalents at the beginning of the year	1,500,000	1,886,867	2,846,306	3,746,332
Total - Cash and equivalents at the end of the year	$1,886,867	$2,846,306	$3,746,332	$20,394,744

ear Cash Short Term Securities Accounts Recervable Inventory $1,886 867 21.00% $2,846 306 28 76% $3,746,332 3355% $0 20,394,744 00096 100.00% 0.00% 0.00% 1,500,000 16.69% 1.800.000 18,19% 2,500,000 22.39% 520,000 466% 400.000 4.45% 3,786,867.2 42.14% 5200000 57.86% $8986 867 100 00% 450.000 4.55% 5096.3056 51.50% 4,800,000" 48.50% $9896 306 100 00% Total- Current Assets 6.766.332 6060% 20.394.744 100.00% Fixed Assets 4,400,000 39.40% 0.00% Total Assets (3) 1 $11 166 332 100 00% $20 394 744 100 00% Cost Cost 0.00%) Accounts Payable $1,000,000 11.13%) 0.00% 0.00% 0009 $800,000 7.16% 0.00% 0.00% 000%| 0.00% Note Payable Bank Total Liabilities 3200 000 4,200,000 35.61%) 3.72%, 1.32%) 2.800 000 28 29%) 3.72% 1.05% 2 3,200,000 2866% 000 21 49% 3.72%) 0.80% 0.00%, 372%| 0.00% 46.73% 53.27%23.84%, 1270% 100.0096 3,600,000 6,296,306 $9,890.300 36.38% 63.62% 100.00% 0.00% 100.00% 100.00% Equity 4,786 867 23.0296 1465% 7966332 7134%, 22.149 15 8096 20,394,744 154490 15.44% Total Liabes & Equity | 8.98655 $11,166,332 100.00% $20394144 WACC on total invested capital