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Pro Forma cash flow , income statement , and balane state ending in 3 month Two product lines Product A Sales Price = $70 per
Pro Forma cash flow , income statement , and balane state ending in 3 month
- Two product lines
- Product A
- Sales Price = $70 per unit
- Costs = $50 per unit
- Half of costs are paid in the current period and half the following month
- Product B
- Sales Price = $100 per unit
- Costs = $70 per unit
- Half of costs are paid in the current period and half the following month
- Product A
- Beginning Inventory
- 5,000 units of product A
- 5,000 units of product B
- Cost of sales on LIFO basis (accounting adjustment made at the end of each quarter)
- Sales Schedule
- Month 1 = 10,000 units of A; 10,000 units of B
- Month 2 = 15,000 units of A; 20,000 units of B
- Month 3 = 15,000 units of A; 25,000 units of B
- Other Cash Outflows
- S,G&A = $150,000 per month
- Quarter end dividend of $250,000
- CAPEX expenditure of $200,000 in month 2
- Other Assumptions
- Sales collected
- 40% month of sale
- 30% following month
- 30% month after that
- Beginning A/R collected $125k in month 1 and $125k in month 2
- Opening A/P balance paid in month 1
- Even production schedule
- Target ending inventory at end of quarter = 50% of previous months sales
- Minimum Cash Balance = $100,000
- Income Tax Rate = 20%
- Long-term Debt interest = 5.5%
- Line of Credit interest rate (if you need to borrow) = 30 day LIBOR (0.50%) plus 350 basis points interest paid on previous months ending balance.
- Sales collected
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