Practice Calculations

1. Calculate monthly C.O.G.S. assuming a 30% mark-up and the following 6 months sales figures:

   1. $4000, $4500, $5000, $6000, $7500, $7500.

   2. Repeat calculations assuming gross contribution margin of 40%.

2. Assuming average monthly sales of $50,000 and average monthly C.O.G.S. of $30,000, calculate the expected level of

   1. Receivables if average collection period is 55 days.

   2. Inventory if you plan on average 40 days on hand.

3. Assuming annual sales of $250,000 and a 50% gross (contribution) margin, calculate the following

   1. Average collection period if ending receivables total $45,000

   2. Ending days-on-hand of inventory if ending inventory levels are $30,000

4. Assuming opening equipment of $100,000 (to be depreciated at $2000/month) plus additional equipment purchase of $50,000 (to be depreciated at $1000/month) in month 6, calculate year-end book value of equipment. Record equipment at cost, accumulated depreciation, and book-value.

5. Calculate B.V. of ending equipment assuming you started the year with $75,000 in equipment, purchased $65,000 in new equipment during the year, and deducted $15,000 in depreciation.

6. Calculate ending receivables assuming opening receivables were $150,000 and sales and collections for the year were $600,000 and $580,000 respectively.

7. Calculate amount collected if sales were $500,000, and opening and ending receivables were $120,000 and $110,000 respectively.

8. Calculate ending inventory assuming opening inventory was $40,000 and purchases and COGS were $300,000 and $280,000 respectively.

9. Calculate ending equity if opening paid in capital was $100,000 and retaining earnings were $55,000, but during the year recorded an after-tax profit of $35,000 and paid dividends of $20,000. Record ending paid-in capital, retained earnings and total equity separately.

10. Calculate year- ending loan balance if you started the year with a $120,000 loan (monthly payments $2000 principal + $500 interest) and a new loan of $20,000 in month 8 to be repaid at $500 principal + $200 interest per month starting the month after the advance).

1. For the above, calculate annual expense.

2. For the above calculate total cash-in and total cash-out. Record the break-down necessary for completion of cash flow forecasts.