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Exhibit 4: Pacific Market Statement of Income, 2015-2016 (unaudited) Total Revenues Cost of Goods Sold Gross Profit Sebastopol Santa Rosa 2015 2016 2015 2016 11.715,045 12,066,532 5,387,973 5.711,732 7,455,258 7,371,132 3,445,140 3,478,553 4,259,787 $ 4,695,400 1,942,834 2,233,179 $ Operating Expenses Labor Benefits & PR Taxes Supplies Employee Gift Certs Advertising & Promotions Discounts (Senior & Emp) Rent PG&E Water and Garbage Phone/Internet R&M Interchange Fees Contract Services Store Operating Expenses Corporate Allocated Exp. Debt Service Total Expenses Operating Profit 1,506,019 603,452 216,770 10,000 55,000 75,000 265,000 135,000 46,000 24,000 36,000 120,000 25,000 37,100 315.000 200,000 $ 3,669,341 $ 590,446 1,597,020 823,916 884,485 638,722 328,867 353,995 241,153 109,285 138,285 10,000 5,000 5,000 65,000 27,000 35,000 115,123 35,000 60,000 265,000 150,000 150,000 135,000 97,000 97,000 46,000 22,000 22,000 24,000 6,000 6,000 60,000 24,000 36,000 120,000 75,000 75,000 25,000 13,000 13,000 37.100 22,850 22,850 315,000 178,000 178,000 200,000 $ 120,000 $ 120,000 3,894,118 2,036,918 2,196,615 801.282 (94.084) 36,564 Source: Tom Scott, Pacific Market consultant Exhibit 5: Pacific Market Balance Sheet, 2015-2016 (unaudited) At December 31 2015 2016 Assets Current Assets Cash $ sa 404,267 $ 622,438 928,643 965,342 222,150 95,048 $ 1,555,060 $ 1,682,828 1,050,835 777,037 $ 2,605,895 $ 2,459,865 $ 423,588 $ 399,264 Accounts Receivable Inventory Other Current Assets Total Current Assets Fixed Assets, Net Total Assets Liabilities and Owner's Equity Current Liabilities Accounts Payable Long-Term Liabilities Loans from Shareholders Mortgages, notes, bonds payable Total Long-Term Liabilities Equity Capital Stock Retained Earnings Total Equity Total Liabilities & Equity 796,800 350,000 998,067 992,628 $ 1,794,867 $ 1,342,628 50,000 337,440 $ 387,440 $ $ 2,605,895 $ 50,000 667,973 717,973 2,459,865 Source: Pacific Market c. The ratios should help you understand the specific situation of the company: What are the positive aspects of the economic performance? What are the negative aspects of the economic performance? Are there problems? If so, what are the root-causes of the problems? Multiple-Stakeholder Approach to Performance Measurement Stakeholder Metrics Explanation Owners/Shareholders B.4.1 ECONOMIC PERFORMANCE Sales Growth= Gross Profit Margin= Net Profit Margin= ROA ROE= Inventory Turnover Days in Inventory Total Asset Turnover Current Ratio= Debt to Equity= Performance Low/Average/High Employees Wages/Salaries, Job Security, Ethical Climate, Work Environment, Benefits, Career opportunities, etc. Customers B.4.2 SOCIAL PERFORMANCE Value as Price/Quality relationship. P/S Reliability. Customer Services, Return Policy, Warranty, Creation of Shared Value Ethical values Communities Job Creation, Social Investment, Creation of Shared Value, Philanthropy. Partnerships with community and government, Management of waste, pollution, noise, traffic, etc.; Landscape, Sharing private space with community, Voice (representative in the board of directors) Government Payment of taxes and fees, Partnerships with governmental agencies, Employment Compliance Suppliers Timely payments, Long-term contracts, Partnerships Competitors Fair competition Nature No Waste, Renewable inputs, Regeneration B.4.3 ECOLOGICAL Sustainable efforts, Truly PERFORMANCE processes and P/S Creation of shared value Adapted from Steven Wartick (2009) Exhibit 4: Pacific Market Statement of Income, 2015-2016 (unaudited) Total Revenues Cost of Goods Sold Gross Profit Sebastopol Santa Rosa 2015 2016 2015 2016 11.715,045 12,066,532 5,387,973 5.711,732 7,455,258 7,371,132 3,445,140 3,478,553 4,259,787 $ 4,695,400 1,942,834 2,233,179 $ Operating Expenses Labor Benefits & PR Taxes Supplies Employee Gift Certs Advertising & Promotions Discounts (Senior & Emp) Rent PG&E Water and Garbage Phone/Internet R&M Interchange Fees Contract Services Store Operating Expenses Corporate Allocated Exp. Debt Service Total Expenses Operating Profit 1,506,019 603,452 216,770 10,000 55,000 75,000 265,000 135,000 46,000 24,000 36,000 120,000 25,000 37,100 315.000 200,000 $ 3,669,341 $ 590,446 1,597,020 823,916 884,485 638,722 328,867 353,995 241,153 109,285 138,285 10,000 5,000 5,000 65,000 27,000 35,000 115,123 35,000 60,000 265,000 150,000 150,000 135,000 97,000 97,000 46,000 22,000 22,000 24,000 6,000 6,000 60,000 24,000 36,000 120,000 75,000 75,000 25,000 13,000 13,000 37.100 22,850 22,850 315,000 178,000 178,000 200,000 $ 120,000 $ 120,000 3,894,118 2,036,918 2,196,615 801.282 (94.084) 36,564 Source: Tom Scott, Pacific Market consultant Exhibit 5: Pacific Market Balance Sheet, 2015-2016 (unaudited) At December 31 2015 2016 Assets Current Assets Cash $ sa 404,267 $ 622,438 928,643 965,342 222,150 95,048 $ 1,555,060 $ 1,682,828 1,050,835 777,037 $ 2,605,895 $ 2,459,865 $ 423,588 $ 399,264 Accounts Receivable Inventory Other Current Assets Total Current Assets Fixed Assets, Net Total Assets Liabilities and Owner's Equity Current Liabilities Accounts Payable Long-Term Liabilities Loans from Shareholders Mortgages, notes, bonds payable Total Long-Term Liabilities Equity Capital Stock Retained Earnings Total Equity Total Liabilities & Equity 796,800 350,000 998,067 992,628 $ 1,794,867 $ 1,342,628 50,000 337,440 $ 387,440 $ $ 2,605,895 $ 50,000 667,973 717,973 2,459,865 Source: Pacific Market c. The ratios should help you understand the specific situation of the company: What are the positive aspects of the economic performance? What are the negative aspects of the economic performance? Are there problems? If so, what are the root-causes of the problems? Multiple-Stakeholder Approach to Performance Measurement Stakeholder Metrics Explanation Owners/Shareholders B.4.1 ECONOMIC PERFORMANCE Sales Growth= Gross Profit Margin= Net Profit Margin= ROA ROE= Inventory Turnover Days in Inventory Total Asset Turnover Current Ratio= Debt to Equity= Performance Low/Average/High Employees Wages/Salaries, Job Security, Ethical Climate, Work Environment, Benefits, Career opportunities, etc. Customers B.4.2 SOCIAL PERFORMANCE Value as Price/Quality relationship. P/S Reliability. Customer Services, Return Policy, Warranty, Creation of Shared Value Ethical values Communities Job Creation, Social Investment, Creation of Shared Value, Philanthropy. Partnerships with community and government, Management of waste, pollution, noise, traffic, etc.; Landscape, Sharing private space with community, Voice (representative in the board of directors) Government Payment of taxes and fees, Partnerships with governmental agencies, Employment Compliance Suppliers Timely payments, Long-term contracts, Partnerships Competitors Fair competition Nature No Waste, Renewable inputs, Regeneration B.4.3 ECOLOGICAL Sustainable efforts, Truly PERFORMANCE processes and P/S Creation of shared value Adapted from Steven Wartick (2009)