Polar Sports, Inc Spreadsheet
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Polar Sports Inc...
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Table A Consolidated Income Statement, 2009-2011 (in thousands of dollars) 2009 2010 Net sales 14,079 15,065 COGS 9,011 10,244 Gross profit 5,068 4,821 Operating expense 3,520 3,615 Interest expense 105 125 Interest income 17 19 Pretax profit 1,461 1,099 Income tax 497 374 Net income 964 725
2011 16,360 10,798 5,562 4,090 128 15 1,359 462 897
Table B Balance Sheet at December 31, 2011 (in thousands of dollars) Cash Accounts receivable Inventory Current assets PP&E Total assets
500 5,245 1,227 6,972 2,988 9,960
Accounts payable Notes payable, bank Accrued taxes Long-term debt, current portion Current liabilities Long-term debt Total liabilities Shareholders’ equity Total liabilities and shareholders’ equity
966 826 139 100 2,031 1,000 3,031 6,929 9,960
Table C Monthly Sales (in thousands of dollars) Sales Projected Sales 2011 2012 January 671 702 February 393 486 March 360 414 April 311 378 May 180 162 June 196 180 July 474 378 August 769 540 September 2,896 2,970 October 2,618 2,520 November 4,564 5,724 December 2,928 3,546 16,360 18,000 Total
Exhibit 1 2012 Pro Forma Balance Sheets and Accured Taxes Under Seasonal Production (in thousands of dollars)
Cash Accounts receivableb Inventoryc Current assets Net PP&Ed Total assets a
Accounts payablee Notes payable, bank Accrued taxesf Long-term debt, current portion Current Liabilities Long-term debtg Total liabilities Shareholders' equity Total liabilities and equity Accrued Taxes Beg. accrued taxes Accrual of monthly taxes Tax payments End. accrued taxes
Actual Dec 31, 2011 500 5,245 1,227 6,972 2,988 9,960
Jan
Feb 1,511 2,541 1,227 5,280 2,988 8,268
2,950 832 1,227 5,009 2,988 7,997
Mar 2,768 630 1,227 4,625 2,988 7,613
Apr 2,477 554 1,227 4,259 2,988 7,247
May 2,274 378 1,227 3,879 2,988 6,867
966 826 139 100 2,031 1,000 3,031 6,929 9,960
232 0 94 100 425 1,000 1,425 6,842 8,268
160 0 26 100 286 1,000 1,286 6,710 7,997
137 0 -188 100 49 1,000 1,049 6,564 7,613
125 0 -388 100 -163 1,000 837 6,409 7,247
53 0 -492 100 -339 1,000 661 6,206 6,867
139
139 -45 0 94
94 -68 0 26
26 -75 -139 -188
-188 -80 -120 -388
-388 -105 0 -492
Assumed maintenance of minimum $500,000 balance. Assumed 60-day collection period for wholesale sales and instant collection for retail sales. c Assumed inventories maintained at December 31, 2011 level for all of 2012. d Assumed equipment purchases equal to depreciation. a
b
Assumed equal to 50% of the current month's COGS for seasonal production; and was related to material purchases that accounts for 50% of COGS for 20 seasonal production and sales pattern. e
Taxes payble on 2011 income are due March 15, 2012. On April 15, June 15, September 15, and December 15, 2012, payments of 25% of each of the estim of $480,000. This implies a payment of $120,000 in April, June, September and December. g To be repaid at the at rate of $50,000 each June and December f
Jun 1,946 239 1,227 3,413 2,988 6,401
Jul 1,625 391 1,227 3,243 2,988 6,231
Aug 1,246 643 1,227 3,116 2,988 6,104
59 0 -715 100 -556 950 394 6,007 6,401
125 0 -795 100 -571 950 379 5,851 6,231
-492 -103 -120 -715
-715 -80 0 -795
Sep
Oct
Nov
Dec
758 2,457 1,227 4,442 2,988 7,430
500 3,843 1,227 5,570 2,988 8,558
500 5,771 1,227 7,498 2,988 10,486
500 6,489 1,227 8,216 2,988 11,204
178 0 -857 100 -578 950 372 5,732 6,104
980 0 -757 100 323 950 1,273 6,158 7,430
832 785 -590 100 1,126 950 2,076 6,482 8,558
1,889 80 -55 100 2,014 950 2,964 7,522 10,486
1,170 847 111 100 2,228 900 3,128 8,076 11,204
-795 -61 0 -857
-857 219 -120 -757
-757 167 0 -590
-590 536 0 -55
-55 285 -120 111
ounts for 50% of COGS for 2012. This represents a 30-day payment period. Since inventories are level, purchases will follow
nts of 25% of each of the estimated tax for 2012 are due. In estimating its tax liability for 2012, the company uses a tax liability
Exhibit 2 2012 Pro Forma Income Statement Under Seasonal Production (in thousands of dollars) Jan Feb Mar Apr Net sales 702 486 414 378 a COGS 463 321 273 249 Gross profit 239 165 141 129 Operating expensesb Interest expense Interest incomec Profit (loss) before tax Income taxesd Net income
360 11 1 -132 -45 -87
360 7 3 -200 -68 -132
360 7 5 -222 -75 -146
360 7 5 -234 -80 -155
May 162 107 55 360 7 4 -308 -105 -203
Assumed cost of goods sold equal to 66% sales. Assumed to be same for each month throughout the year. c 2% annualized rate of return on monthly cash balances. d Negative figures are tax credits from operating losses, and reduced accured taxes shown on balance sheets. The federal tax rate on all earnings was 34% a
b
Jun
Jul
Aug
Sep
Oct
Nov
Dec
180 119 61
378 249 129
540 356 184
2,970 1,960 1,010
2,520 1,663 857
5,724 3,778 1,946
3,546 2,340 1,206
360 7 4 -302 -103 -200
360 7 3 -235 -80 -155
360 7 3 -181 -61 -119
360 7 2 645 219 426
360 7 1 491 167 324
360 11 1 1,576 536 1,040
360 7 1 839 285 554
The federal tax rate on all earnings was 34%.
Total 18,000 11,880 6,120 4,320 94 32 1,737 591 1,147
Exhibit 3 2012 Pro Forma Cash Flow Statement Under Seasonal Production (in thousands of dollars) Jan Feb Mar Operating Activities Net income -87 -132 -146 Depreciation 25 25 25 Less: Increase (Decrease) in A/R -2,704 -1,710 -202 Less: Increase (Decrease) in Inventory 0 0 0 Add: Increase (Decrease) in A/P -735 -71 -24 Add: Increase (Decrease) in Accrued Taxes -45 -68 -214 Cash flow from operations 1,862 1,464 -157 Investing Activities Less: capital expenditures Cash flow from operating and investing Cash available before financing activities Financing Activities Less: bank note repayment Less: debt repayment Add: bank note issuance Cash flow from financing Total Cash Flow
Apr -155 25 -76 0 -12 -200 -265
-25 1,837 1,837
-25 1,439 2,450
-25 -182 2,268
-25 -290 1,977
826 0 0 -826
0 0 0 0
0 0 0 0
0 0 0 0
1,011
1,439
-182
-290
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
-203 25 -176 0 -71 -105 -178
-200 25 -139 0 6 -223 -253
-155 25 151 0 65 -80 -296
-119 25 252 0 53 -61 -354
426 25 1,814 0 802 99 -463
324 25 1,386 0 -149 167 -1,018
1,040 25 1,928 0 1,057 536 731
554 25 718 0 -719 165 -693
-25 -203 1,774
-25 -278 1,496
-25 -321 1,125
-25 -379 746
-25 -488 258
-25 -1,043 -785
-25 706 706
-25 -718 -718
0 0 0 0
0 50 0 -50
0 0 0 0
0 0 0 0
0 0 0 0
0 0 785 785
706 0 0 -706
0 50 768 718
-203
-328
-321
-379
-488
-258
0
0
Exhibit 4 2012 Pro Forma Balance Sheets and Accured Taxes Under Level Production (in thousands of dollars) Actual Dec 31, 2011 Cash
Jan
Feb
Mar
1,511
5,245
2,541
832
630
554
1,227
1,227
1,227
1,227
1,227
Current assets
6,972
5,280
5,009
4,625
4,259
Net PP&E
2,988
2,988
2,988
2,988
2,988
9,960
8,268
7,997
7,613
7,247
Accounts payablee
966
232
160
137
125
Notes payable, bank
826
0
0
0
0
Accrued taxes
139
94
26
-188
-388
100
100
100
100
100
2,031
425
286
49
-163
1,000
1,000
1,000
1,000
1,000
Total liabilities
3,031
1,425
1,286
1,049
837
Shareholders' equity
6,929
6,842
6,710
6,564
6,409
Total liabilities and equity
9,960
8,268
7,997
7,613
7,247
Beg. accrued taxes
139
94
26
-188
Accrual of monthly taxes
-45
-68
-75
-80
0
0
-139
-120
94
26
-188
-388
Accounts receivable
b
Inventoryc d
Total assets
f
Long-term debt, current portion Current Liabilities Long-term debt
g
2,950
Apr
500
a
2,768
2,477
Accrued Taxes
Tax payments End. accrued taxes
139
May
Jun
2,274
Jul 1,946
Aug 1,625
Sep
Oct
Nov
Dec
1,246
758
500
500
500
378
239
391
643
2,457
3,843
5,771
6,489
1,227
1,227
1,227
1,227
1,227
1,227
1,227
1,227
3,879
3,413
3,243
3,116
4,442
5,570
7,498
8,216
2,988
2,988
2,988
2,988
2,988
2,988
2,988
2,988
6,867
6,401
6,231
6,104
7,430
8,558
10,486
11,204
53
59
125
178
980
832
1,889
1,170
0
0
0
0
0
785
80
847
-492
-715
-795
-857
-757
-590
-55
111
100
100
100
100
100
100
100
100
-339
-556
-571
-578
323
1,126
2,014
2,228
1,000
950
950
950
950
950
950
900
661
394
379
372
1,273
2,076
2,964
3,128
6,206
6,007
5,851
5,732
6,158
6,482
7,522
8,076
6,867
6,401
6,231
6,104
7,430
8,558
10,486
11,204
-388
-492
-715
-795
-857
-757
-590
-55
-105
-103
-80
-61
219
167
536
285
0
-120
0
0
-120
0
0
-120
-492
-715
-795
-857
-757
-590
-55
111
Exhibit 2 2012 Pro Forma Income Statement Under Level Production (in thousands of dollars) Jan
Feb
Mar
Apr
May
Jun
Net sales
702
486
414
378
162
180
COGSa
421
292
273
227
97
108
Gross profit
281
194
141
151
65
72
Operating expensesb
360
360
360
360
360
360
Interest expense
11
7
7
7
7
7
Interest income
5
4
4
3
3
2
Profit (loss) before tax
-86
-169
-223
-213
-299
-293
Income taxesd
-29
-57
-76
-72
-102
-100
Net income
-57
-111
-147
-140
-198
-193
c
a
Assumed cost of goods sold equal to 60% sales.
b
Assumed to be same for each month throughout the year.
c
2% annualized rate of return on monthly cash balances.
d
Negative figures are tax credits from operating losses, and reduced accured taxes shown on balance sheets. The federal tax rate on all earnings was 34%. Jan
Feb
Mar
Apr
May
Jun
Net sales
702
486
414
378
162
180
COGSa
421
292
248
227
97
108
Gross profit
281
194
166
151
65
72
92
50
50
50
50
50
Operating expensesb Interest expense Interest incomec Profit (loss) before tax Income taxesd Net income
Jul
Aug
Sep
Oct
Nov
Dec
Total
378
540
2,970
2,520
5,724
3,546
18,000
227
324
1,782
1,512
3,434
2,128
10,825
151
216
1,188
1,008
2,290
1,418
7,175
360
360
360
360
360
360
4,320
7
11
7
11
0
0
83
1
1
1
1
0
0
24
-215
-154
821
638
1,930
1,058
2,796
-73
-52
279
217
656
360
951
-142
-102
542
421
1,274
699
1,845
ate on all earnings was 34%. Jul
Aug
Sep
Oct
Nov
Dec
Total
378
540
2,970
2,520
5,724
3,546
18,000
227
324
1,782
1,512
3,434
2,128
10,800
151
216
1,188
1,008
2,290
1,418
7,200
50
50
50
50
50
50
Exhibit 3 2012 Pro Forma Cash Flow Statement Under Level Production (in thousands of dollars) Jan
Feb
Mar
Apr
Operating Activities Net income
-87
-132
-146
-155
Depreciation
25
25
25
25
-2,704
-1,710
-202
-76
Less: Increase (Decrease) in A/R Less: Increase (Decrease) in Inventory
0
0
0
0
-735
-71
-24
-12
-45
-68
-214
-200
1,862
1,464
-157
-265
-25
-25
-25
-25
Cash flow from operating and investing
1,837
1,439
-182
-290
Cash available before financing activities
1,837
2,450
2,268
1,977
Add: Increase (Decrease) in A/P Add: Increase (Decrease) in Accrued Taxes Cash flow from operations Investing Activities Less: capital expenditures
Financing Activities Less: bank note repayment
826
0
0
0
Less: debt repayment
0
0
0
0
Add: bank note issuance
0
0
0
0
-826
0
0
0
1,011
1,439
-182
-290
Cash flow from financing Total Cash Flow
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
-203
-200
-155
-119
426
324
1,040
554
25
25
25
25
25
25
25
25
-176
-139
151
252
1,814
1,386
1,928
718
0
0
0
0
0
0
0
0
-71
6
65
53
802
-149
1,057
-719
-105
-223
-80
-61
99
167
536
165
-178
-253
-296
-354
-463
-1,018
731
-693
-25
-25
-25
-25
-25
-25
-25
-25
-203
-278
-321
-379
-488
-1,043
706
-718
1,774
1,496
1,125
746
258
-785
706
-718
0
0
0
0
0
0
706
0
0
50
0
0
0
0
0
50
0
0
0
0
0
785
0
768
0
-50
0
0
0
785
-706
718
-203
-328
-321
-379
-488
-258
0
0
sales growth projection sales net income in 2011 projection income COGS 2012 under seasonal Op expenses 2012 seasonal or level corporate tax wholesale channel after exhibition under seasonal production in 2012 ac payable total purchase 2011 end cash balance end of 2011 av interest paid in 2011 withdrawal > 2000 oustanding long term bond cap ex net block in 2012 in 2012 storage and handling cost in 2012
4650 in 2001 18000 in 2012 897 1147 in 2012 66% of sales 24% 34% 70% of sales 15% of annual sales same inv held from 31 dec 2011 50% of COGS of that month based on 30 day payment 500 outstanding loan 6% 11% interest 1000 300 won't change cogs 60% 300
Overtime wage premiums 480,000 Other direct labor savings 600,000 Net savings before financial charges, carrying costs, inventory losses, and taxes 1,080,000 Increase in interest expenses 147,923 Reduction in interest income 16,140 Increase in storage cost 300,000 Net pretax savings 615,937 Less tax at 34% 209,418 Net savings 406,518
16360 in 2011
evenly throughout each month
shipped in sep
total purchase in 2012 2012 forcast minimum for operations req.
60 days payment time
5940 826 should not exceed 2/3 of ac receivable+inventory
in balance sheet as on 2011 dec equal to dep as capex=dep won't change monthly under level production
osses, and taxes
coupon 8% amortized evenly divided throughout the yr
saving 480 and 600
eceivable+inventory
50 in june and dec each year
level prodn.
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