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Exhibit 1
Shipments at Selling Price (thousands of dollars)
1979
January
February
March
April
May
June
July
August
Eight months total
As Forecast
Dec. 1978
$1,302
$1,872
$1,635
$1,053
$1,293
$1,479
$1,488
$1,797
$11,919
September
October
November
December
$1,299
$1,347
$1,311
$2,298
Actual
$861
$672
$1,866
$1,566
$873
$1,620
$723
$507
$8,688
As Forecast
Sept. 1979
$2,163
$1,505
$1,604
$2,265
$2,500
$2,000
Fore
cast
$1,500
$1,000
$500
ob
er
O
ct
Ju
ly
Ap
ril
Ja
nu
ar
y
$0
Exhibit 2
Balance Sheets, 1978--1979 (thousands of dollars)
1978
1979
Nov.
Dec.
Mar.
Cash
$2,520
$491
$505
Accounts receivable, net
$1,245
$1,863
$1,971
Inventories
$2,601
$2,478
$3,474
Current assets
$6,366
$4,832
$5,950
June
$1,152
$1,893
$3,276
$6,321
July
$1,678
$1,269
$3,624
$6,571
Aug.
$1,559
$684
$4,764
$7,007
$4,010
$3,040
$970
$4,010
$3,070
$940
$4,010
$3,080
$930
$4,010
$3,090
$920
$39
$24
$24
$42
Prepaid expenses
Total assets
$4,010
$2,998
$1,012
$62
$4,010
$3,010
$1,000
###
$40
$7,440
$5,872
###
$6,959
$7,285
$7,525
$7,969
$0
$348
$561
$150
$840
$1,899
$1,000
$371
$777
$74
$1,040
$3,262
###
$1,000
$681
$849
$373
$1,040
$3,943
$1,000
$399
$678
$354
$1,566
$3,997
$1,000
$621
$585
$407
$1,566
$4,179
$1,000
$948
$552
$479
$1,566
$4,545
$428
$2,182
$2,610
###
$428
$2,588
$3,016
$428
$2,860
$3,288
$428
$2,918
$3,346
$428
$2,996
$3,424
$5,872
###
$6,959
$7,285
$7,525
$7,969
$7,440
*Tax payments in 1979 include $75,000 due March 15 on underpayment of 1978 taxes and four equal
payments of $181,000 due on the 15th of April, June, September, and December for estimated 1979 tax
liability with any underpayment of 1979 taxes due March 15, 1980.
Exhibit 3
Income Statements, 1978--1979 (thousands of dollars)
Fiscal
Year
Ending
Dec.
1979
31/12/78
1978
Jan.
Net sales
$7,854
$1,551
$861
Cost of sales*
$5,052
$1,122
$474
Gross profit
$2,802
$429
$387
Selling and admin expenses $1,296
Interest expense
$0
Net income before taxes $1,506
Income taxes
Net income
Dividends
Feb.
$672
$369
$303
Mar.
$1,866
$1,362
$504
Apr.
$1,566
$1,137
$429
May
$873
$567
$306
June
$1,620
$1,197
$423
July
$723
$510
$213
Aug.
$507
$276
$231
$248
$0
$181
$103
$15
$269
$61
$15
$227
$205
$15
$284
$172
$15
$242
$96
$15
$195
$130
$15
$278
$87
$15
$111
$66
$15
$150
$723
$87
$129
$109
$136
$116
$94
$133
$53
$72
$783
$94
$140
$118
$148
$126
$101
$145
$58
$78
$50
$25
$0
$0
$0
$0
$0
$100
$0
$0
* Includes depreciation charges of $150,000 in 1978, $12,000 in December 1987, and $10,000 per month in 1979.
Eight
Months
Ending
31/8/79
$8,688
$5,892
$2,796
$920
$120
$1,756
$842
$914
$0
$100
Historical
July
$723
Aug.
$507
$1,327
$293
$15
$278
$133
$145
$597
$126
$15
$111
$53
$58
$342
$165
$15
$150
$72
$78
Sept.
$2,163
$600
$1,320
$105
$2,025
$10
$400
$2,435
($272)
$15
($287)
($138)
($149)
$100
$45
$0
$58
$0
$78
$0
($149)
$0
$230
$0
$242
$150
$436
Cash (plug)
Accounts receivable, net
Inventories
Current assets
Gross fixed assets
Accumulated depreciation
Net fixed assets
Prepaid expenses
Total assets
$1,152
$1,893
$3,276
$6,321
$4,010
$3,070
$940
$24
$7,285
$1,678
$1,269
$3,624
$6,571
$4,010
$3,080
$930
$24
$7,525
$1,559
$684
$4,764
$7,007
$4,010
$3,090
$920
$42
$7,969
$699
$1,323
$3,339
$5,361
$4,010
$3,100
$910
$42
$6,313
$1,007
$779
$3,234
$5,020
$4,360
$3,110
$1,250
$42
$6,312
$766
$1,604
$3,129
$5,499
$4,360
$3,124
$1,237
$42
$6,778
($331)
$2,265
$3,024
$4,958
$4,360
$3,137
$1,223
$42
$6,223
$1,000
$399
$678
$354
$1,566
$3,997
$428
$2,860
$3,288
$7,285
$1,000
$621
$585
$407
$1,566
$4,179
$428
$2,918
$3,346
$7,525
$1,000
$948
$552
$479
$1,566
$4,545
$428
$2,996
$3,424
$7,969
$1,000
$600
$552
$160
$726
$3,038
$428
$2,847
$3,275
$6,313
$1,350
$600
$552
$305
$0
$2,807
$428
$3,077
$3,505
$6,312
$1,350
$600
$552
$529
$0
$3,031
$428
$3,319
$3,747
$6,778
$0
$600
$552
$888
$0
$2,040
$428
$3,755
$4,183
$6,223
$526
($119)
($860)
$308
($241)
($1,097)
Net sales
Purchases
WIP inventory reduction
Raw materials reduction
Cost of goods sold
Depreciation
Other expenses
Cost of sales and other expenses
EBIT
Interest expense
Net income before taxes
Income taxes
Net income
Dividends
Earnings retained
Change in cash
Pro Forma
Oct.
Nov.
$1,505
$1,604
$600
$600
$0
$0
$105
$105
$705
$705
$10
$14
$400
$400
$1,115
$1,119
$390
$486
$15
$20
$375
$466
$145
$223
$230
$242
Dec.
$2,265
$600
$0
$105
$705
$14
$400
$1,119
$1,147
$20
$1,127
$541
$586
$-
$-
Cash Outflows:
Payments of Accounts Payable:
Other Operating Outflows:
Purchase New Equipment:
Tax Payments:
Interest Payments to Bank:
Principal Repayments to Bank:
Dividends:
Total cash outflows:
$-
$-
Reconciliation:
Begining cash balance:
Net cash flow:
Ending cash balance:
December
January
$-
$-
$-
$-
$-
$-