8. Mini Case: TadPole, is a startup company that designs and sells high end bamboo fly rods. Jon DiNardo, the founder of the company, designs and sells the fly rods. Although he is an amazing rod designer and world class fisher, he lacks financial acumen. As a result, the company's financial records are not well maintained. The initial investment in the startup was provided by and his friends and family. Because the initial investment was relatively small, and the company's products have only been available for sale in its own store and the investors haven't required detailed financial statements. However, Matthew McConoughey was recently spotted fishing with a TadPole rod and the product has gone viral. Jon DiNardo would like to take advantage of this surge of interest and is considering a major expansion. His plans include opening another store in Jackson, Wyoming, as well as distributing rods to other resellers. Jon's expansion plans require a significant investment, which he plans to finance with a combination of additional funds from outside investors as well as debt financing in the form of bank loans. Although the influx of investment would enable expansion, new investors and creditors would require more organized and detailed financial statements. Jon has hired a financial analyst, Thomas Klein to help him with this task. Thomas sifted through old bank statements, sales receipts, tax returns, and other records, to find the following information: TadPole currently pays out 40 percent of net income as dividends to Jon and the other original investors, and it has a 21 percent tax rate. You are Thomas's assistant, and he has asked you to prepare the following: 1. How would you describe TadPole's cash flows for 2022 ? Write a brief discussion. 2. In light of your discussion in the previous question, what do you think about TadPole's expansion plans? 8. Mini Case: TadPole, is a startup company that designs and sells high end bamboo fly rods. Jon DiNardo, the founder of the company, designs and sells the fly rods. Although he is an amazing rod designer and world class fisher, he lacks financial acumen. As a result, the company's financial records are not well maintained. The initial investment in the startup was provided by and his friends and family. Because the initial investment was relatively small, and the company's products have only been available for sale in its own store and the investors haven't required detailed financial statements. However, Matthew McConoughey was recently spotted fishing with a TadPole rod and the product has gone viral. Jon DiNardo would like to take advantage of this surge of interest and is considering a major expansion. His plans include opening another store in Jackson, Wyoming, as well as distributing rods to other resellers. Jon's expansion plans require a significant investment, which he plans to finance with a combination of additional funds from outside investors as well as debt financing in the form of bank loans. Although the influx of investment would enable expansion, new investors and creditors would require more organized and detailed financial statements. Jon has hired a financial analyst, Thomas Klein to help him with this task. Thomas sifted through old bank statements, sales receipts, tax returns, and other records, to find the following information: TadPole currently pays out 40 percent of net income as dividends to Jon and the other original investors, and it has a 21 percent tax rate. You are Thomas's assistant, and he has asked you to prepare the following: 1. How would you describe TadPole's cash flows for 2022 ? Write a brief discussion. 2. In light of your discussion in the previous question, what do you think about TadPole's expansion plans