Say there is a business. It buys and sells a product, lets be creative and call it Product X. Heres what happened during the year.

a) At the beginning of the year, they had 1,000 units of X in their warehouse.

b) Also at the beginning of the year, they had $150,000 in their checking account.

c) They bought 59,000 units of X. Every time they buy X, it costs them $1.20. During the year, the wrote checks for all of this amount.

d) They sold 50,000 units of X to their customers. They charged $3 per unit. Thats $150,000 (just to make sure your calculator is working). However, they did not actually collect all $150,000. They actually were paid $120,000. For the other $30,000, customers couldnt pay right away, but they promised to pay soon so they owed the money.

To make it simple, lets assume that the only additional facts are as follows:

e) The company rents its office. Its $5,000 a month. On the last day of each month, the landlord walks in and hand delivers a bill for the rent for the month that just finished. At that same moment, the business hands the landlord a check. So, the rent for the first 11 months was 11*$5,000 = $55,000.

f) On the last month, however, the landlord was TOO BUSY and forgot to come collect the rent.

g) During the year, the company purchased office equipment for $100,000. The paid for this in cash. (Actually, they wrote a check, but thats the same thing). They figure that this equipment will be used for the next 10 years.

h) ALL THE OTHER COSTS OF RUNNING THE BUSINESS... ALL ... come to a grand total of $5,000. These were also ALL PAID during the period.

I.How did the business do? Did it make money? If so, how much? Be prepared to explain HOW you got your answer.

II.Are these results good? WHY or WHY NOT?

III.How many units of X are left in their warehouse at the end? How did you get this?

IV.How about money from customers ... do customers owe the business money, yes or no? If so, how much?V.How much cash is left in the company checking account at the end of the year?

Please help and give explanations. Thanks!