PJ Tessier
Cost of goods sold Cas "e#reciation nterest e%#ense &ell &ellin ing g and ad'in d'inis isttrati( ati(e e )cco*nts Pa+ale -et .%ed assets &ales )cco*nts re(ei(ale -otes #a+ale ong ter' det n(entor+ -e e*it+
Finance
$
2014 196,619 $ 28,3!2 55,506 12,06! 38,66 8,668 8 20,143 244,881 385,!24 20,104 22,855 123,60! 38,!06
2/10/16 2015 248,263 42,865 62,!38 13,831 50,46 0,469 9 34,091 298,350 4!0,1!2 26,0!8 24,955 140,000 52,05! 15,000
PJ Tessier
Finance
2/10/16
Sunset Boards, Inc. 2014 Income Statement -et &ales Cost of goods sold &elling and )d'inistrati(e "e#reciation arnings efore interest and ta% nterest arnings efore ta% Ta%es Ta%es 30 30 -et nco'e "i(idends 40 of net inco'e )ddition to retained earnings
$
$ $ $ $
23,202 34,803
385,!24 196,619 38,668 55,506 94,931 12,06! 82,864 24,859 58,005
PJ Tessier
Finance
2/10/16
Sunset Boards, Inc. 2015 Income Statement -et &ales Cost of goods sold &elling and )d'inistrati(e "e#reciation arnings efore interest and ta% nterest arnings efore ta% Ta%es Ta%es 30 30 -et nco'e "i(idends 40 of net inco'e )ddition to retained earnings
$
$ $ $ $
26,564 39,846
4!0,1!2 248,263 50,469 62,!38 108,!02 13,831 94,8!1 28,461 66,410
PJ Tessier
Finance
2/10/16
Sunset Boards, Inc. 2014 Balance Sheet Assets C*rrent )ssets Cas )cco*nts 7ecei(ale n(entor+ Total Total -et Fi%ed )ssets Total Total )ssets
$
$ $ $
Liabilities and Owners' !uit" C*rrent iailities 28 28,3!2 )cco*nts Pa+ale $ 20,143 20,104 -otes Pa+ale 22,855 38,!06 Total $ 42,998 8!,182 ong Ter' "et $ 123,60! 24 2 44,881 ners *it+ $ 165,458 332,063 Total iailities and ners *i *i $ 332,063
PJ Tessier
Finance
2/10/16
Sunset Boards, Inc. 2015 Balance Sheet Assets C*rrent )ssets Cas )cco*nts 7ecei(ale n(entor+ Total Total -et Fi%ed )ssets Total Total )ssets
$
$ $ $
Liabilities and Owners' !uit" C*rrent iailities 42,865 )cco*nts Pa+ale $ 34,091 26,0!8 -otes Pa+ale 24,955 52,05! Total $ 59,046 121,000 ong Ter' "et $ 140,000 298,350 ners *it+ $ 220,304 419,350 Total iailities and ners * * $ 419,350
PJ Tessier
Finance
Sunset Boards, Inc. 2014 O#eratin$ %ash &low arnings :efore nterest est and Ta% "e#reciation ; Ta%es Operating Cash Flow
$
$
94,931 55,506 24,859 125,5!8
2/10/16
PJ Tessier
Finance
Sunset Boards, Inc. 2015 O#eratin$ %ash &low ar arning ings :efo efore nter nteres estt and Ta% "e#reciation ; Ta%es Operating Cash Flow
$
$
108,! 108, !02 62,!38 28,461 142,9!9
2/10/16
PJ Tessier
Finance
Sunset Boards, Inc. 2015 %ash &low rom Assets #erating Cas Flo -et Ca#ital &#ending Cange in -et
$
$
142,9!9 116,20! 1!,!!0 9,002
2/10/16
PJ Tessier
Finance
Sunset Boards, Inc. 2015 %ash &low to %reditors nterest Paid -et -e :orroing Cash Flow to Creditors
$ $
13,831 16,393 2,562
2/10/16
PJ Tessier
Finance
Sunset Boards, Inc. 2015 %ash &low to Stoc(holders "i(idends Paid -et -e *it+ 7aised Cas Flo to &toc=olders
$ $
26,564 15,000 11,564
2/10/16
PJ Tessier
Finance
2/10/16
>*estion 1? @o o*ld +o* descrie &*nset :oardsA cas Bos for 2015 Te o#erating cas cas Bo is #osti(e ic sos tat &*nset &*nset :oards :oards is 'a=ing eno*g stoc=oldersD -et ca#ital s#ending is ig in regard to te o#erating cas Bo ic fro' assets is not negati(e ic sos te co'#an+ is still orroing, *t not at as re'aining 'one+ is s*Ecient eno*g to distri*te to creditors and stoc=oldersD >*estion >*estion 2? n ligt ligt of +o*r disc*ss disc*ssion ion of of te #re(io* #re(io*s s *estio *estion, n, at at do do +o* tin= tin= a Tads Tads e%#ansion e%#ansion #lans see' see' so*nd loo=ing loo=ing at te 2015 cas Bos *t *t 'a+ need to #osi #ositi ti(e (e i ic c 'ea 'eans ns te te co'# co'#an an+ + can can ao aord rd to or orro ro 'or 'ore 'one 'one+ + if te+ te+ a( a(e e en #otential sales are not +et esti'ated, it o*ld o*ld e s'art for Tad Tad to .nd o*t eter eter 'one+ orroed orroed fro' an=sD an=sD Te safest 'o(e Tad co*ld 'a=e to e%#and, e%#and, o*ld e t o#ening anoter storeD <ile te addition to retained earnings is al'ost $40,000, te co'# co'#an an+ +s s asse assets ts for forcing cing te' te' to e *na *nale le to re#a+ e#a+ loan loans s *nde *nderr *ne *ne%#ec %#ecte ted d cir circ*' c*' is to to 'o(e 'o(e in in s'al s'alll ste#s ste#s and grad*a grad*all+ ll+ earn earn 'one+ 'one+ ile ile also also gain gaining ing a good good re#*t re#*ta a
PJ Tessier
Finance
'one+ to co(er its o*tBos s*c as cas Bos to creditors creditors and is ca*sed + te co'#an+s cas s#ent on .%ed assetsD Cas Bo ig of a rate as it o*ld e if it ere groing *ic=l+D Te
*t TadAs e%#ansion #lans sloed for a safer a##roacD Te cas Bo fro' assets is still o*g e(idence to so tat te+ ill sell 'ore oardsD f te ill e ale to gi(e ac= to is in(estors ile still #a+ing o o .rst test te #ro.tailit+ of selling to oter sellers efore i''ediate costs of o#ening anoter store 'igt de#lete te stancesD Tads idea is s'art *t te safest 'o(e for te co'#an+ tion for a good #rod*ctD
2/10/16
