Assuming no brokerage fees, calculate the amount of cash needed to retire Baldwin's 11.1S2024 bond early. Select: 1 $2,421,445 $2,504,080 -$82,635 The Andrews company currently has the following balances in their equity accounts: Common Stock Retained earnings $17,080 $89,610 Suppose next year the Andrews company generates $46,300 in Net Profit, and declares and pays $16,000 in Dividends. What will Andrews ending balance in Retained Earnings be next year? Select: 1 $122,690 $119,910 $63,380 $106,690 Of Baldwin Corporation's products, which earned the highest Net Margin as a percentage of its sales? Select: 1 Buddy Beetle Bold Bat Baldwin's product Bold has material costs that are rising from $13.66 to $14.66. Assume that period costs and other labor costs remain unchanged. If Baldwin decides to absorb the cost and not pass any on to its customers in the form of raised prices how many units of product Bold would need to be sold next round to break even on the product? Select: 1 1,876 537 584 613 How much would it cost for Chester Corporation to repurchase all its outstanding shares if the price fell by 10%? Assume no brokerage fees. Select: 1 $87.3 million $81.6 million $90.6 million $97.0 million Refer to the HR Report section of the Inquirer. Chester will continue to keep their current hourly levels of training in order to help reduce turnover and improve productivity next year. How much must be spent per employee on an hourly basis to maintain the current training commitment? Select: 1 $30 $20 $18 $9,618 Suppose you were hired as a consultant for a company that wants to penetrate the Comp-XM market. This company wants to pursue a broad cost leader strategy. From last year's reports, which company would be the strongest competitor? Select: 1 Digby Chester Baldwin Andrews The Baldwin company will increase its automation for the Bat product by 2.0. Assuming no further change in capacity, how much will this investment in automation cost? Select: 1 $18,200,000 $10,400,000 $20,800,000 $9,100,000 Page 1 Front Page Page 2 Stocks & Bonds Page 3 Financial Summary Page 4 Production Analysis Annual Report Andrews Page 5 Thrift Segment Analysis Page 6 Core Segment Analysis Page 7 Nano Segment Analysis Page 8 Elite Segment Analysis Page 9 Market Share Page 10 Perceptual Map Page 11 HR/TQM Report Annual Report Baldwin Annual Report Chester Annual Report Digby PRINT Top " Round: 3 Student: Inho Chang Dec. 31, 2018 Andrews Inho Chang Baldwin Chester Digby Inho Chang Selected Financial Statistics Andrews Baldwin Chester Digby 8.6% 13.1% 1.8% 1.3% 0.96 1.25 0.71 0.76 8.3% 16.3% 1.3% 1.0% 1.3 1.7 2.5 2.4 10.6% 28.4% 3.3% 2.4% $0 $0 $0 $0 Sales $131,015,772 $224,523,850 $162,673,905 $192,230,790 EBIT $20,454,598 $53,618,533 $21,504,667 $20,925,418 Profits $11,307,569 $29,372,867 $3,009,101 $2,505,822 Cumulative Profit $33,671,162 $61,513,355 $8,021,131 $10,505,528 SG&A / Sales 14.5% 6.0% 8.3% 11.3% Contrib. Margin % 42.8% 37.9% 36.1% 36.0% ROS Asset Turnover ROA Leverage (Assets/Equity) ROE Emergency Loan COMP-XM INQUIRER Page 1 Top Round: 3 Stocks & Bonds Inho Chang December 31 , 2018 Stock Market Summary Shares MarketCap ($M) Book Value Company Close Change EPS Dividend Yield P/E Andrews $79.55 $5.84 2,103,561 $5.38 $1.50 1.9% 14.8 Baldwin $121.25 $34.06 1,905,606 $231 $54.24 $15.41 $0.00 0.0% 7.9 Chester $28.69 ($0.27) 3,380,533 $97 $26.81 $0.89 $0.00 0.0% 32.2 Digby $38.54 ($0.89) 3,162,219 $122 $33.61 $0.79 $0.00 0.0% 48.6 $167 $50.72 Bond Market Summary Company Series# Face Yield Close$ S&P 11.2S2022 $8,837,000 10.9% 103.16 AAA 11.9S2023 $7,072,000 11.2% 106.41 AAA 10.9S2026 $8,000,000 10.5% 103.71 AAA 11.1S2024 $2,504,080 11.5% 96.70 BBB 11.2S2025 $5,675,277 11.6% 96.80 BBB 11.5S2026 $1,307,561 11.7% 98.01 BBB 11.7S2027 $18,390,714 11.8% 98.93 BBB 12.5S2028 $13,731,325 12.1% 103.40 BBB 11.3S2022 $10,417,600 12.2% 92.69 CC 12.5S2023 $14,665,611 13.1% 95.52 CC 12.5S2024 $7,981,720 13.2% 94.92 CC 12.5S2025 $9,473,587 13.2% 94.39 CC 12.9S2026 $14,407,694 13.5% 95.80 CC 13.4S2027 $34,619,932 13.7% 98.01 CC 14.2S2028 $8,009,917 13.9% 102.10 CC 11.2S2022 $8,639,846 12.0% 92.95 CC 12.4S2023 $5,828,840 12.9% 95.84 CC 11.9S2025 $15,600,742 12.8% 92.62 CC Andrews Baldwin Chester Digby 12.5S2026 $17,783,553 13.2% 94.83 CC 13.1S2027 $34,893,410 13.4% 97.49 CC 13.7S2028 $22,306,984 13.6% 100.53 CC Next Year's Prime Rate 9.00% COMP-XM INQUIRER Page 2 Top Financial Summary Cash Flow Statement Survey Round: 3 December 31, 2018 Inho Chang Andrews Baldwin Chester Digby $11,308 $29,373 $3,009 $2,506 $9,645 $11,184 $17,087 $18,378 $0 $0 $0 $0 $92 $1,257 $1,050 $3,237 ($4,260) ($4,543) ($10,489) ($12,565) $43 ($2,692) ($330) ($3,233) $16,828 $34,579 $10,326 $8,323 ($11,200) ($46,000) ($28,600) ($56,905) ($3,155) $0 $0 $0 Cash flows from operating activities Net Income (Loss) Adjustment for non-cash items: Depreciation Extraordinary gains/losses/writeoffs Changes in current assets and liabilities: Accounts payable Inventory Accounts receivable Net cash from operations Cash flows from investing activities Plant improvements (net) Cash flows from financing activities Dividends paid Sales of common stock $0 $0 $12,983 $20,783 Purchase of common stock $0 ($1,713) $0 $0 Cash from long term debt issued $0 $13,731 $8,010 $22,307 Early retirement of long term debt $0 $0 $0 $0 ($11,300) ($29,582) ($43,296) ($34,024) Cash from current debt borrowing $0 $23,200 $30,886 $29,225 Cash from emergency loan $0 $0 $0 $0 ($14,455) $5,636 $8,583 $38,291 ($8,827) ($5,785) ($9,691) ($10,291) Andrews Baldwin Chester Digby Cash $32,298 $34,565 $42,045 $30,903 Accounts Receivable $10,768 $18,454 $13,370 $15,800 Inventory $19,623 $19,618 $14,008 $17,926 Total Current Assets $62,689 $72,637 $69,423 $64,629 Plant and equipment $144,676 $167,760 $256,300 $275,665 Accumulated Depreciation ($70,448) ($60,588) ($95,369) ($88,777) $74,228 $107,172 $160,931 $186,888 $136,918 $179,809 $230,354 $251,517 $6,318 $11,631 $9,271 $10,967 $0 $23,200 $30,886 $29,225 Retirement of current debt Net cash from financing activities Net change in cash position Balance Sheet Survey Total Fixed Assets Total Assets Accounts Payable Current Debt Long Term Debt $23,909 $41,609 $99,576 $105,053 Total Liabilities $30,227 $76,440 $139,734 $145,245 Common Stock $17,080 $11,364 $52,604 $56,963 Retained Earnings $89,610 $92,005 $38,016 $49,309 Total Equity $106,690 $103,369 $90,620 $106,272 Total Liabilities & Owners' Equity $136,918 $179,809 $230,354 $251,517 Income Statement Survey Andrews Baldwin Chester Digby Sales $131,016 $224,524 $162,674 $192,231 $74,964 $139,325 $103,995 $123,013 $9,645 $11,184 $17,087 $18,378 $18,952 $13,434 $13,538 $21,760 $7,000 $6,962 $6,550 $8,155 $20,455 $53,619 $21,505 $20,925 Interest (Short term, Long term) $2,703 $7,507 $16,781 $16,992 Taxes $6,213 $16,139 $1,653 $1,377 $231 $599 $61 $51 $11,308 $29,373 $3,009 $2,506 Variable Costs (Labor, Material, Carry) Depreciation SGA (R&D, Promo, Sales, Admin) Other (Fees, Writeoffs, TQM, Bonuses) EBIT Profit Sharing Net Profit COMP-XM INQUIRER Page 3 Top Production Analysis Inho Chang Round: 3 December 31, 2018 Production Information Unit Primary Inve Age Segmen Units n Revisio Dec. MTB Pfmn Size Name t Sold tory n Date 31 F Coord Coord Auto 2nd matio Shift n Contr & Next Capacit Plan Materia Labor . Over- Roun y Next Uti Price l Cost Cost Marg. time d Round z Abby Nano 990 0 9/9/201 1.4 24000 8 13.0 4.8 $39.00 $13.82 $7.46 46% 8% 5.5 1,128 10 % Alan Elite 990 0 7/17/20 1.3 26000 18 15.5 8.2 $42.00 $14.15 $7.50 48% 9% 5.5 1,114 10 % Aft Thrift 972 691 5/24/20 2.0 18000 18 8.0 12.0 $23.00 $7.09 $6.55 33% 0% 6.0 1,430 76% Agap e Core 903 543 6/8/201 1.6 21000 8 10.2 9.5 $31.50 $9.86 $7.86 38% 0% 5.0 1,500 73% Bold Nano 1,782 0 11/5/20 1.2 23000 18 14.1 4.0 $34.00 $13.66 $7.91 39% 100% 7.0 1,200 19 % Budd y Elite 1,418 116 8/24/20 1.9 25000 18 16.9 6.0 $34.00 $14.56 $6.69 36% 53% 7.0 850 15 % Bat Nano 1,514 365 7/3/201 1.3 23000 8 14.6 3.5 $37.00 $14.04 $7.74 39% 80% 7.0 1,300 17 % 7/25/20 1.3 25000 18 16.7 5.7 $37.00 $14.57 $7.51 38% 59% 7.0 1,450 15 % Beetle Elite 1,613 411 Coat Thrift 2,167 159 6/10/20 3.7 17000 19 8.4 11.7 $16.00 $6.80 $2.98 37% 52% 10.0 1,550 15 % Cure Thrift 2,279 303 6/10/20 3.6 17000 19 8.6 11.5 $16.00 $6.96 $2.97 35% 50% 10.0 1,750 14 % Cake Core 1,806 310 12/16/2 2.1 18000 017 11.5 8.0 $24.00 $9.72 $4.70 37% 86% 8.0 1,250 18 % Cent Core 2,008 310 12/18/2 2.1 20000 017 12.2 8.5 $24.00 $10.36 $4.62 35% 73% 8.0 1,500 17 % Dot Thrift 1,066 346 12/20/2 2.2 14000 018 9.1 11.0 $17.00 $6.82 $1.80 52% 0% 10.0 Dune Core 2,066 256 12/6/20 3.1 16000 16 10.0 10.1 $19.00 $8.14 $4.20 33% 53% 9.9 1,548 15 % Dart Nano 1,421 248 12/17/2 1.0 18000 018 13.5 3.9 $30.00 $12.74 $7.40 33% 94% 7.0 1,090 19 % Deft Elite 890 266 12/17/2 1.0 20000 018 16.6 6.4 $36.00 $13.59 $6.55 43% 24% 7.0 1,042 12 % Dim Core 1,762 120 12/25/2 0.9 16000 018 11.4 8.6 $21.00 $9.31 $5.84 29% 83% 7.3 1,097 18 % Don Core 1,053 2/10/20 0.9 16000 18 11.1 9.0 $22.00 $9.03 $4.46 38% 100% 8.0 1,023 17 % 0 COMP-XM INQUIRER 1,250 99% Page 4 Top Thrift Market Segment Analysis Inho Chang Round: 3 December 31, 2018 Thrift Statistics Total Industry Unit Demand 6,978 Actual Industry Unit Sales 6,978 Segment % of Total Industry 26.1% Next Year's Segment Growth Rate 11.0% Thrift Customer Buying Criteria Expectations Importance 1. Price 2. Reliability 3. Ideal Position 4. Age $14.00 - 26.00 55% MTBF 14000-20000 20% Pfmn 8.6 Size 11.5 15% Ideal Age = 3.0 10% Perceptual Map for Thrift Segment Top Products in Thrift Segment Units Sold Revisio Market to n Stock Pfmn Size Name Share Seg Date Out Coord Coord Cure 28% 1,972 6/10/20 19 8.6 Cust. Dec. Age Promo Aware Sales Cust. Cust. List MTB Dec. Budge Budge Access- Surve Price F 31 t ness t ibility y 11.5 $16.00 17000 3.64 $1,250 79% $1,400 75% 55 Coat 28% 1,968 6/10/20 19 8.4 11.7 $16.00 17000 3.74 $1,250 78% $1,400 75% 54 Dot 15% 1,040 12/20/2 018 9.1 11.0 $17.00 14000 2.25 $1,140 66% $1,000 72% 31 Aft 13% 935 5/24/20 18 8.0 12.0 $23.00 18000 1.96 $1,500 100% $2,500 75% 26 Dune 11% 792 12/6/20 16 10.0 10.1 $19.00 16000 3.11 $1,140 67% $1,000 72% 24 Dim 3% 211 12/25/2 018 11.4 8.6 $21.00 16000 0.88 $1,140 58% $900 72% 0 Agap e 0% 33 6/8/201 8 10.2 9.5 $31.50 21000 1.63 $1,500 100% $2,500 75% 1 Don 0% 28 2/10/20 YES 11.1 18 9.0 $22.00 16000 0.89 $1,140 51% 3 COMP-XM INQUIRER $900 72% Page 5 Top Core Market Segment Analysis Inho Chang Core Statistics Total Industry Unit Demand 8,889 Actual Industry Unit Sales 8,889 Segment % of Total Industry 33.3% Core Customer Buying Criteria Expectations Importance 1. Price $20.00 - 32.00 46% 2. Age Ideal Age = 2.0 20% MTBF 16000-22000 18% Pfmn 11.6 Size 8.5 16% 3. Reliability 4. Ideal Round: 3 December 31, 2018 Perceptual Map for Core Segment Position Top Products in Core Segment Units Sold Revisio Market to n Stock Pfmn Size Name Share Seg Date Out Coord Coord Cust. Dec. Age Promo Aware Sales Cust. Cust. List MTB Dec. Budge Budge Access- Surve Price F 31 t ness t ibility y Cent 21% 1,909 12/18/2 017 12.2 8.5 $24.00 20000 2.10 $1,250 78% $1,100 76% 50 Cake 19% 1,686 12/16/2 017 11.5 8.0 $24.00 18000 2.09 $1,250 78% $1,100 76% 44 Dim 17% 1,551 12/25/2 018 11.4 8.6 $21.00 16000 0.88 $1,140 58% $900 72% 38 Dune 14% 1,274 12/6/20 16 10.0 10.1 $19.00 16000 3.11 $1,140 67% $1,000 72% 26 Don 12% 1,025 2/10/20 YES 11.1 18 9.0 $22.00 16000 0.89 $1,140 51% $900 72% 31 Agap e 10% 6/8/201 8 9.5 $31.50 21000 1.63 $1,500 100% $2,500 75% 20 871 10.2 Cure 3% 307 6/10/20 19 8.6 11.5 $16.00 17000 3.64 $1,250 79% $1,400 76% 2 Coat 2% 199 6/10/20 19 8.4 11.7 $16.00 17000 3.74 $1,250 78% $1,400 76% 0 Aft 0% 36 5/24/20 18 8.0 12.0 $23.00 18000 1.96 $1,500 100% $2,500 75% 0 Dot 0% 27 12/20/2 018 9.1 11.0 $17.00 14000 2.25 $1,140 66% $1,000 72% 8 Bold 0% 4 11/5/20 YES 14.1 18 4.0 $34.00 23000 1.24 $1,350 87% $1,000 11% 0 COMP-XM INQUIRER Page 6 Top Nano Market Segment Analysis Inho Chang Nano Statistics Total Industry Unit Demand 5,407 Actual Industry Unit Sales 5,407 Segment % of Total Industry 20.3% Next Year's Segment Growth Rate 14.0% Round: 3 December 31, 2018 Nano Customer Buying Criteria Expectations Importance 1. Ideal Position Pfmn 13.5 Size 3.7 35% 2. Price $28.00 - 40.00 27% 3. Age Ideal Age = 1.0 20% MTBF 18000-24000 18% 4. Reliability Perceptual Map for Nano Segment Top Products in Nano Segment Units Sold Revisio Market to n Stock Pfmn Size Name Share Seg Date Out Coord Coord Bat 27% 1,456 7/3/201 8 Bold 26% 1,401 Dart $900 83% 48 11/5/20 YES 14.1 18 4.0 $34.00 23000 1.24 $1,350 87% $1,000 83% 62 24% 1,288 12/17/2 018 13.5 3.9 $30.00 18000 1.03 $1,140 67% $1,900 70% 46 Abby 16% 847 9/9/201 YES 13.0 8 4.8 $39.00 24000 1.37 $1,500 100% $2,500 82% 47 Cake 2% 120 12/16/2 017 11.5 8.0 $24.00 18000 2.09 $1,250 78% $1,100 18% 2 Beetle 2% 100 7/25/20 18 16.7 5.7 $37.00 25000 1.34 $1,350 87% $900 83% 0 Cent 2% 99 12/18/2 017 12.2 8.5 $24.00 20000 2.10 $1,250 78% $1,100 18% 1 Deft 1% 75 12/17/2 018 16.6 6.4 $36.00 20000 1.04 $1,140 67% $2,200 70% 0 Budd y 0% 20 8/24/20 18 16.9 6.0 $34.00 25000 1.90 $1,350 87% $1,000 83% 0 COMP-XM INQUIRER 14.6 Cust. Dec. Age Promo Aware Sales Cust. Cust. List MTB Dec. Budge Budge Access- Surve Price F 31 t ness t ibility y 3.5 $37.00 23000 1.34 $1,350 87% Page 7 Top Elite Market Segment Analysis Inho Chang Elite Statistics Total Industry Unit Demand 5,428 Actual Industry Unit Sales 5,428 Segment % of Total Industry 20.3% Next Year's Segment Growth Rate 16.0% Round: 3 December 31, 2018 Elite Customer Buying Criteria Expectations Importance 1. Age Ideal Age = 0.0 34% 2. Price $30.00 - 42.00 24% Pfmn 16.4 Size 6.6 22% MTBF 20000-26000 20% 3. Ideal Position 4. Reliability Perceptual Map for Elite Segment Top Products in Elite Segment Units Sold Revisio Market to n Stock Pfmn Size Name Share Seg Date Out Coord Coord Cust. Dec. Age Promo Aware Sales Cust. Cust. List MTB Dec. Budge Budge Access- Surve Price F 31 t ness t ibility y Beetle 28% 1,513 7/25/20 18 16.7 5.7 $37.00 25000 1.34 $1,350 87% $900 87% 48 Budd y 26% 1,398 8/24/20 18 16.9 6.0 $34.00 25000 1.90 $1,350 87% $1,000 87% 47 Alan 18% 990 7/17/20 YES 15.5 18 8.2 $42.00 26000 1.31 $1,500 99% $1,800 83% 33 Deft 15% 815 12/17/2 018 16.6 6.4 $36.00 20000 1.04 $1,140 67% $2,200 69% 30 Bold 7% 377 11/5/20 YES 14.1 18 4.0 $34.00 23000 1.24 $1,350 87% $1,000 87% 8 Abby 3% 143 9/9/201 YES 13.0 8 4.8 $39.00 24000 1.37 $1,500 100% $2,500 83% 8 Dart 2% 133 12/17/2 018 13.5 3.9 $30.00 18000 1.03 $1,140 67% $1,900 69% 1 Bat 1% 58 7/3/201 8 14.6 3.5 $37.00 23000 1.34 $1,350 87% 1 COMP-XM INQUIRER $900 87% Page 8 Top Market Share Report Actual Market Share in Units Inho Chang Round: 3 December 31, 2018 Thrif Core Nano Elite t Total Industry Unit Sales 6,978 8,889 5,407 5,428 26,702 % of Market 26.1 33.3 20.3 20.3 % % % % 100.0 % Abby 15.7 2.6% % 3.7% Alan 18.2 % 3.7% Aft Agape Total Bold 13.4 0.4% % 3.6% 0.5% 9.8% 3.4% 13.9 10.2 15.7 20.9 % % % % 14.4% 25.9 7.0% % 6.7% 25.8 % 5.3% 26.9 1.1% % 5.7% 27.9 % 6.0% 55.1 61.7 % % 23.7% 0.0% Buddy 0.4% Bat Beetle 1.9% Total 0.0% Coat 28.2 2.2% % 8.1% Cure 28.3 3.5% % 8.5% Cake 19.0 2.2% % 6.8% Cent 21.5 1.8% 7.5% % Total 56.5 46.1 4.0% % % Dot 14.9 0.3% % 4.0% Dune 11.3 14.3 % % 7.7% Dart Deft 30.9% 23.8 2.5% % 5.3% 15.0 % 3.3% 1.4% Dim 3.0% 17.4 % 6.6% Don 0.4% 11.5 % 3.9% 29.7 43.6 25.2 17.5 % % % % Total 30.9% Potential Market Share in Units Thrift Core Nano Elite Total 6,978 8,889 5,407 5,428 26,702 26.1% 33.3% 20.3% 20.3% 100.0% Abby 22.3% 3.8% 5.3% Alan 19.9% 4.0% Units Demande d % of Market Aft Agape 13.4% 0.4% 3.6% 0.5% 9.6% 3.3% Total 13.8% 10.1% 22.3% 23.7% 16.3% Bold 26.8% 7.3% 6.9% Buddy 0.3% 24.6% 5.1% 23.4% 1.1% 5.0% 1.7% 26.7% 5.8% 0.0% 52.2% 59.6% 22.7% Bat Beetle Total Coat 28.3% 2.3% 8.2% Cure 28.2% 3.4% 8.5% Cake 18.6% 1.9% 6.6% Cent 21.1% 1.6% 7.4% Total 56.5% 45.4% 3.6% 30.6% Dot 14.8% 0.3% 4.0% Dune 11.3% 14.1% 7.7% Dart 20.7% 2.4% 4.7% Deft 1.2% 14.4% 3.2% Dim 3.0% 17.2% 6.5% Don 0.5% 12.9% 4.4% Total 29.7% 44.5% 21.9% 16.8% 30.4% COMP-XM INQUIRER Page 9 Top Perceptual Map Inho Chang Round: 3 December 31, 2018 Perceptual Map for All Segments Andrews Name Pfmn Size Revised Abby 13.0 4.8 9/9/2018 Alan 15.5 8.2 7/17/2018 Aft 8.0 12.0 5/24/2018 Agape 10.2 9.5 6/8/2018 Name Pfmn Size Revised Bold 14.1 4.0 11/5/2018 Buddy 16.9 6.0 8/24/2018 Bat 14.6 3.5 7/3/2018 Beetle 16.7 5.7 7/25/2018 COMP-XM INQUIRER Page 10 Top HR/TQM Report Round: 3 December 31, 2018 Inho Chang HUMAN RESOURCES SUMMARY Andrews Baldwin Chester Digby Needed Complement 504 675 481 668 Complement 505 675 481 668 1st Shift Complement 486 390 290 417 2nd Shift Complement 19 285 191 251 Overtime% 0.0% 0.0% 0.0% 0.0% Turnover Rate 7.7% 10.0% 8.0% 6.1% New Employees 39 68 57 191 Separated Employees 63 0 0 0 $500 $0 $2,500 $5,000 60 0 40 80 108.1% 100.0% 115.6% 124.3% Recruiting Spend Training Hours Productivity Index Recruiting Cost $59 $68 $200 $1,147 Separation Cost $315 $0 $0 $0 Training Cost $606 $0 $385 $1,070 Total HR Admin Cost $980 $68 $584 $2,216 $29.56 $29.56 $29.56 $29.56 Benefits 2,500 2,500 2,500 2,500 Profit Sharing 2.0% 2.0% 2.0% 2.0% Annual Raise 5.0% 5.0% 5.0% 5.0% Labor Contract Next Year Wages Starting Negotiation Position Wages Benefits Profit Sharing Annual Raise Ceiling Negotiation Position Wages Benefits Profit Sharing Annual Raise Adjusted Labor Demands Wages Benefits Profit Sharing Annual Raise Strike Days TQM SUMMARY Andrews Baldwin Chester Digby CPI Systems $1,500 $0 $1,250 $1,500 Vendor/JIT $1,000 $0 $1,250 $1,500 Quality Initiative Training $1,500 $1,250 $0 $0 Channel Support Systems $0 $1,250 $1,500 $0 Concurrent Engineering $0 $1,250 $0 $0 UNEP Green Programs $1,500 $0 $0 $1,500 $1,500 $0 $0 $1,500 Quality Function Deployment Effort $0 $0 $0 $0 CCE/6 Sigma Training $0 $1,250 $750 $0 GEMI TQEM Sustainability Initiatives $0 $1,250 $750 $0 $7,000 $6,250 $5,500 $6,000 2.21% 6.43% 6.03% 1.41% Process Mgt Budgets Last Year TQM Budgets Last Year Benchmarking Total Expenditures Cumulative Impacts Material Cost Reduction Labor Cost Reduction 7.90% 13.93% 1.78% 0.05% Reduction R&D Cycle Time 13.54% 39.79% 0.00% 0.00% Reduction Admin Costs 36.12% 0.00% 16.23% 43.11% 0.62% 9.37% 5.47% 0.45% Demand Increase COMP-XM INQUIRER Page 11 PRINT Annual Report Top Annual Report Andrews C59559 Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The company's long term debt is in the form of bonds, and this represents the total value of Round: 7 Dec. 31, 2018 your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends. ASSETS 2018 2017 Common Size Cash $32,298 23.6% $41,126 Accounts Receivable $10,768 7.9% $10,812 Inventory $19,623 14.3% $15,362 45.8% $67,300 Total Current Assets $62,689 Plant & Equipment $144,676 105.7% $133,476 Accumulated Depreciation ($70,448) -51.5% ($60,803) $74,228 54.2% $72,673 $136,918 100.0% $139,973 $6,318 4.6% $6,226 $0 0.0% $11,300 $23,909 17.5% $23,909 22.1% $41,435 Total Fixed Assets Total Assets LIABILITIES & OWNERS' EQUITY Accounts Payable Current Debt Long Term Debt Total Liabilities $30,227 Common Stock $17,080 12.5% $17,080 Retained Earnings $89,610 65.4% $81,458 Total Equity $106,690 77.9% $98,538 Total Liab. & O. Equity $136,918 100.0% $139,973 Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat. Cash Flows from Operating Activities: Net Income (Loss) Depreciation Extraordinary gains/losses/writeoffs 2018 2017 $11,308 $11,790 $9,645 $8,898 $0 $0 Accounts Payable Inventory Accounts Receivable Net cash from operations $92 ($652) ($4,260) $4,856 $43 $835 $16,828 $25,727 Cash Flows from Investing Activities: ($11,200 ($21,052 ) ) Plant Improvements Cash Flows from Financing Activities: Dividends Paid ($3,155) $0 Sales of Common Stock $0 $0 Purchase of Common Stock $0 $0 Cash from long term debt $0 $0 Retirement of long term debt $0 ($11,300 ) Change in current debt (net) ($11,300 $11,300 ) Net cash from financing activities ($14,455 ) $0 Net change in cash position ($8,827) $4,675 Closing cash position $32,298 $41,126 Annual Report Page 1 Top Annual Report Andrews Round: 7 Dec. 31, 2018 C59559 2018 Income Statement (Product Name:) Sales Abby Alan 2018 Total Commo n Size Aft Agape Na Na Na Na $38,616 $41,587 $22,353 $28,460 $0 $0 $0 $0 $131,016 100.0% Variable Costs: Direct Labor $7,383 $7,431 $6,564 $7,221 $0 $0 $0 $0 $28,598 21.8% $13,570 $14,084 $7,202 $9,154 $0 $0 $0 $0 $44,011 33.6% $0 $1,175 $1,180 $0 $0 $0 $0 $2,355 1.8% $20,954 $21,515 $14,940 $17,555 $0 $0 $0 $0 $74,964 57.2% Contribution $17,663 $20,072 $7,412 $10,905 Margin $0 $0 $0 $0 $56,051 42.8% $0 $0 $0 $0 $9,645 7.4% $442 $0 $0 $0 $0 $2,086 1.6% $1,500 $1,500 $1,500 $1,500 $0 $0 $0 $0 $6,000 4.6% $2,500 $1,800 $2,500 $2,500 $0 $0 $0 $0 $9,300 7.1% $340 $0 $0 $0 $0 $1,565 1.2% Total Period $7,266 $6,424 $7,525 $7,382 $0 $0 $0 $0 $28,597 21.8% Net Margin $10,397 $13,648 ($113) $3,523 $0 $0 $0 $0 $27,455 21.0% Direct Material Inventory Carry Total Variable $0 Period Costs: Depreciation SG&A: R&D Promotion s Sales Admin $2,106 $2,079 $2,860 $2,600 $699 $461 $548 $497 $398 $267 Definitions: Sales: Unit sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost to carry unsold goods in inventory. Depreciation: Calculated on straight-line 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Charges not included in other categories such as Fees, Write Offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last year's current debt, including short term debt, long term notes that have become due, and emergency loans. Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing. Other $7,000 5.3% EBIT $20,455 15.6% Short Term Interest $0 0.0% LongTerm Interest $2,703 2.1% Taxes $6,213 4.7% Profit Sharing Net Profit Annual Report $231 0.2% $11,308 8.6% Page 2 PRINT Annual Report Top Annual Report Baldwin C59559 Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The company's long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends. ASSETS 2018 2017 Round: 7 Dec. 31, 2018 Common Size Cash $34,565 19.2% $40,350 Accounts Receivable $18,454 10.3% $15,762 Inventory $19,618 10.9% $15,075 40.4% $71,187 Total Current Assets $72,637 Plant & Equipment $167,760 93.3% $121,760 Accumulated Depreciation ($60,588) -33.7% ($49,404) Total Fixed Assets $107,172 59.6% $72,356 Total Assets $179,809 100.0% $143,544 LIABILITIES & OWNERS' EQUITY Accounts Payable $11,631 6.5% $10,374 Current Debt $23,200 12.9% $29,582 Long Term Debt $41,609 23.1% $27,878 42.5% $67,834 Total Liabilities $76,440 Common Stock $11,364 6.3% $11,627 Retained Earnings $92,005 51.2% $64,082 Total Equity $103,369 57.5% $75,709 Total Liab. & O. $179,809 100.0% $143,544 Equity Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat. Cash Flows from Operating Activities: 2018 2017 Net Income (Loss) $29,373 $19,983 Depreciation $11,184 $8,117 $0 $0 $1,257 $2,228 Extraordinary gains/losses/writeoffs Accounts Payable Inventory ($4,543) ($1,711) Accounts Receivable ($2,692) ($3,346) Net cash from operations $34,579 $25,271 Cash Flows from Investing Activities: Plant Improvements ($46,000 ($27,800 ) ) Cash Flows from Financing Activities: Dividends Paid $0 $0 Sales of Common Stock $0 $2,808 Purchase of Common Stock ($1,713) $0 Cash from long term debt $13,731 $18,391 Retirement of long term debt Change in current debt (net) Net cash from financing activities $0 ($11,300 ) ($6,382) $15,297 $5,636 $25,197 Net change in cash position ($5,785) $22,667 Closing cash position $34,565 $40,350 Annual Report Page 1 Top Annual Report Baldwin Round: 7 Dec. 31, 2018 C59559 2018 Income Statement (Product Name:) 2018 Total Commo n Size Bat Beetle Na Na Na Na $60,598 $48,221 $56,020 $59,685 $0 $0 $0 $0 $224,524 100.0% Direct Labor $14,095 $9,981 $11,748 $12,263 $0 $0 $0 $0 $48,086 Sales Bold Buddy Variable Costs: 21.4% Direct Material $0 $0 $0 $0 $88,884 $956 $1,097 $0 $0 $0 $0 $2,354 1.0% $37,288 $31,010 $34,031 $36,996 $0 $0 $0 $0 $139,325 62.1% Contribution $23,310 $17,211 $21,988 $22,689 Margin $0 $0 $0 $0 $85,199 37.9% $0 $0 $0 $0 $11,184 5.0% $571 $0 $0 $0 $0 $2,595 1.2% $1,350 $1,350 $1,350 $1,350 $0 $0 $0 $0 $5,400 2.4% $1,000 $1,000 Inventory Carry Total Variable $23,193 $20,728 $21,327 $23,636 $0 $301 39.6% Period Costs: Depreciation SG&A: R&D Promotion s Sales $3,024 $1,927 $2,947 $3,287 $858 $655 $510 $900 $900 $0 $0 $0 $0 $3,800 1.7% $409 $436 $0 $0 $0 $0 $1,639 0.7% Total Period $6,675 $5,284 $6,116 $6,543 $0 $0 $0 $0 $24,618 11.0% Net Margin $16,635 $11,927 $15,873 $16,146 $0 $0 $0 $0 $60,581 27.0% Admin $442 $352 Definitions: Sales: Unit sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost to carry unsold goods in inventory. Depreciation: Calculated on straight-line 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Charges not included in other categories such as Fees, Write Offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last year's current debt, including short term debt, long term notes that have become due, and emergency loans. Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing. Other $6,962 3.1% EBIT $53,619 23.9% Short Term Interest $2,575 1.1% LongTerm Interest $4,932 2.2% Taxes Profit Sharing Net Profit $16,139 7.2% $599 0.3% $29,373 13.1% Annual Report Page 2 PRINT Annual Report Top Annual Report Chester C59559 Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The company's long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends. ASSETS 2018 2017 Common Size Cash $42,045 18.3% $51,736 Accounts Receivable $13,370 5.8% $13,040 Inventory $14,008 6.1% $3,518 Round: 7 Dec. 31, 2018 Total Current Assets $69,423 30.1% $68,294 Plant & Equipment $256,300 111.3% $227,700 Accumulated Depreciation ($95,369) -41.4% ($78,282) Total Fixed Assets $160,931 69.9% $149,418 Total Assets $230,354 100.0% $217,712 $9,271 4.0% $8,222 Current Debt $30,886 13.4% $43,296 Long Term Debt $99,576 43.2% $91,566 60.7% $143,084 LIABILITIES & OWNERS' EQUITY Accounts Payable Total Liabilities $139,733 Common Stock $52,604 22.8% $39,621 Retained Earnings $38,016 16.5% $35,007 $90,620 39.3% $74,628 $230,354 100.0% $217,712 Total Equity Total Liab. & O. Equity Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat. Cash Flows from Operating Activities: 2018 Net Income (Loss) $3,009 ($1,158) Depreciation Extraordinary gains/losses/writeoffs Accounts Payable Inventory Accounts Receivable Net cash from operations 2017 $17,087 $15,180 $0 $0 $1,050 ($914) ($10,489 ) $6,359 ($330) $168 $10,326 $19,635 Cash Flows from Investing Activities: Plant Improvements ($28,600 ($50,140 ) ) $0 $0 Cash Flows from Financing Activities: Dividends Paid Sales of Common Stock $12,983 $11,991 Purchase of Common Stock Cash from long term debt $0 $0 $8,010 $34,620 Retirement of long term debt Change in current debt (net) Net cash from financing activities $0 ($11,300 ) ($12,410 $18,093 ) $8,583 $53,404 Net change in cash position ($9,691) $22,898 Closing cash position $42,045 $51,736 Annual Report Page 1 Top Annual Report Chester Round: 7 Dec. 31, 2018 C59559 2018 Income Statement (Product Name:) Sales Coat Cure Cake 2018 Total Commo n Size Cent Na Na Na Na $34,678 $36,461 $43,341 $48,194 $0 $0 $0 $0 $162,674 100.0% $6,464 $6,826 $8,503 $9,301 $0 $0 $0 $0 $31,095 19.1% $15,233 $16,416 $18,125 $21,445 $0 $0 $0 $0 $71,219 43.8% $0 $0 $0 $0 Variable Costs: Direct Labor Direct Material Inventory $192 $371 $549 $570 $1,681 1.0% Carry Total Variable $21,889 $23,614 $27,176 $31,316 $0 $0 $0 $0 $103,995 63.9% Contribution $12,790 $12,847 $16,165 $16,878 Margin $0 $0 $0 $0 $58,679 36.1% 10.5% Period Costs: Depreciation $4,753 $5,367 $3,167 $3,800 $0 $0 $0 $0 $17,087 SG&A: R&D $1,000 $1,000 $0 $0 $0 $0 $0 $2,000 1.2% $1,250 $1,250 $1,250 $1,250 $0 $0 $0 $0 $5,000 3.1% $1,400 $1,400 $1,100 $1,100 $0 $0 $0 $0 $5,000 3.1% $456 $0 $0 $0 $0 $1,538 0.9% Total Period $8,731 $9,361 $5,926 $6,606 $0 $0 $0 $0 $30,625 18.8% Net Margin $4,058 $3,486 $10,238 $10,272 $0 $0 $0 $0 $28,054 17.2% Promotion s Sales Admin $328 $345 $0 $410 Definitions: Sales: Unit sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost to carry unsold goods in inventory. Depreciation: Calculated on straight-line 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Charges not included in other categories such as Fees, Write Offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last year's current debt, including short term debt, long term notes that have become due, and emergency loans. Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing. Other $6,550 4.0% EBIT $21,505 13.2% Short Term Interest $3,953 2.4% LongTerm Interest $12,827 7.9% Taxes $1,653 1.0% Profit Sharing Net Profit $61 0.0% $3,009 1.8% Annual Report Page 2 PRINT Annual Report Top Annual Report Digby C59559 Round: 7 Dec. 31, 2018 Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The company's long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends. ASSETS 2018 2017 Common Size Cash $30,903 12.3% $41,195 Accounts Receivable $15,800 6.3% $12,567 Inventory $17,926 7.1% $5,361 25.7% $59,123 Total Current Assets $64,629 Plant & Equipment $275,665 109.6% $218,760 Accumulated Depreciation ($88,777) -35.3% ($70,400) Total Fixed Assets $186,888 74.3% $148,360 Total Assets $251,517 100.0% $207,483 LIABILITIES & OWNERS' EQUITY Accounts Payable $10,967 4.4% $7,730 Current Debt $29,225 11.6% $34,024 $105,053 41.8% $82,746 57.7% $124,500 Long Term Debt Total Liabilities $145,245 Common Stock $56,963 22.6% $36,179 Retained Earnings $49,309 19.6% $46,803 Total Equity $106,272 42.3% $82,982 Total Liab. & O. Equity $251,517 100.0% $207,483 Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat. Cash Flows from Operating Activities: 2018 2017 Net Income (Loss) $2,506 $3,368 Depreciation Extraordinary gains/losses/writeoffs $18,378 $13,224 $0 $0 $3,237 $1,081 Inventory ($12,565 ) $5,482 Accounts Receivable ($3,233) ($2,616) Accounts Payable Net cash from operations $8,323 $20,540 Cash Flows from Investing Activities: Plant Improvements ($56,905 ($53,460 ) ) $0 $0 Cash Flows from Financing Activities: Dividends Paid Sales of Common Stock $20,783 $17,533 Purchase of Common Stock Cash from long term debt $0 $0 $22,307 $34,893 Retirement of long term debt $0 ($11,300 ) Change in current debt (net) ($4,800) $12,285 Net cash from financing activities $38,291 $53,411 Net change in cash position Closing cash position ($10,291 $20,491 ) $30,903 $41,195 Annual Report Page 1 Top Annual Report Digby Round: 7 Dec. 31, 2018 C59559 2018 Income Statement (Product Name:) Dune Dart Deft Dim 2018 Total Commo n Size Don Na Na $18,129 $39,259 $42,635 $32,049 $36,992 $23,167 $0 $0 $192,231 100.0% Direct Labor $2,008 $8,728 $10,485 $5,901 $10,292 $4,701 $0 $0 $42,115 21.9% Direct Material $6,405 $17,402 $17,583 $11,795 $15,781 $9,782 $0 $0 $78,747 41.0% $0 $0 Sales Dot Variable Costs: Inventory $328 $388 $589 $634 $213 $0 $2,151 1.1% Carry Total Variable $8,741 $26,518 $28,657 $18,330 $26,285 $14,482 $0 $0 $123,013 64.0% Contribution Margin $9,388 $12,741 $13,978 $13,719 $10,706 $8,685 $0 $0 $69,218 36.0% $3,833 $4,706 $2,471 $2,362 $2,574 $2,432 $0 $0 $18,378 9.6% $114 $0 $0 $4,039 2.1% $1,140 $1,140 $1,140 $1,140 $1,140 $1,140 $0 $0 $6,840 3.6% $1,000 $1,000 $1,900 $2,200 Period Costs: Depreciation SG&A: R&D Promotion s Sales $983 $0 $973 $973 $995 $900 $900 $0 $0 $7,900 4.1% $574 $359 $0 $0 $2,982 1.6% Total Period $7,237 $7,455 $7,145 $7,172 $6,183 $4,945 $0 $0 $40,138 20.9% Net Margin $2,151 $5,287 $6,833 $6,547 $4,523 $3,740 $0 $0 $29,080 15.1% Admin $281 $609 $661 $497 Definitions: Sales: Unit sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost to carry unsold goods in inventory. Depreciation: Calculated on straight-line 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Charges not included in other categories such as Fees, Write Offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last year's current debt, including short term debt, long term notes that have become due, and emergency loans. Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing. Other $8,155 4.2% EBIT $20,925 10.9% Short Term Interest $3,595 1.9% LongTerm Interest $13,397 7.0% Taxes Profit Sharing Net Profit Annual Report $1,377 0.7% $51 0.0% $2,506 1.3% Page 2