Question

Can someone help with #5 & 6 please?

Now assume that 20.000 dinal sh o cked to an angel investor a months after the initial incorporation Sh 5 per share o w your awwer in Part A would change of the com mon Mock did not have a vall a nwerin Part par value of 0.01 per share would change given At the end of the first year of S h ow dollar amounts in the common the w all paid in capital account, and there fained earnings account at the end Al e the ative amount is s holders equity at the end of one year 2. Temal Operating Schedule Ame r i v ing the manufacture and sale of a new product Raw material e s Direct labor costs are expected to be $10 per product. You expect to welche s 5110 You plan to produce 100 products month and expect to sell products A Prepare cost of production costos d o s cales formed the first month B During the second month you 110 p ts d sales in the month to be 115 products. Prepare cost of productio and to schedules for the sec and month 3. Internal Operating Schedule you have de n de a prototypedectronic product and are about to start your new business. You purchase preprogrammed computer chips $70 per unit. Other component costs include plastic casines a $15 and a mbly hardware at 55 per unit. Direct labor costs are $15 per hour and three units can be produced per hour You intend to each unit at a 50 percent markup over the total cost of producing each unit. The plan is to produce 500 product units per month in lanuary February and March Sales are expected to be 300 units in January, 100 units in February, and 800 units in March A Calculate the dollar amount of sales revenue expected in each month the lanuary February, and March) and for the first quarter of the year B. Prepare a cost of production schedule for January February, and March C Prepare a cost of goods sold schedule for each of the three months and for the first quarter of the year. Using your cost of goods sold estimates and the sales revenues expected in Part A calculate the gross earnings for January, February, and March, as well as for the first quarter of the year. D. Prepare an inventories schedule for January, February, and March . Assume you ramp up pro- 4. Internal Operating Schedule) This problem is a continuation of Problem duction to 1.000 units per month in April May, and June Sales are expected to be 800 units in April and 1.100 units in both May and June. Repeat the calculations requested in Problem 3 for the second quarter of the year (April, May, and June). 5. Survival Revenue Breakeven) During its first year of operations, the SubRay Corporation produced the following income statement results: $300 Net sales Cost of goods sold Gross profit -0.00 FT General and administrative -0.000 d Maig penses Deco - 10 ore - 10.000 30 000 Earnings before tas Income Net Gaming Costs of goods sold are expected to vary with sales and be a constant percentage of sales. The general and administrative employees have been hired and are expected to remain a fixed cost. Marketing

Answer 1

Answer-5(A):

EBITDA = Earnings before interest taxes and depreciation & amortization

              = -$20,000 + $20,000 = 0

EBDAT Break even = EBDAT – interest = 0 - $10,000 = -$10,000

Answer-5(B):

To make EBDAT Break even point zero, net sales should increase more than 10,000. If selling price is $50 per unit, the number of units will be 200 units i.e. (10,000 / $50)

Answer-6(A):

2016 $ 75,000 Cash Flow from Operating Activities: Net Income Adjustment to Reconcile Net Income to Net Cash Provided by (used for) Operating Activities: Depreciation expense Increase in account receivable Increase in inventory, WIP and FG Increase in account payable Increase in accruals Increase in bank loans 40,000 (80,000) (100,000) 30,000 20,000 10,000 Net cash flow from operating activities $ (5,000)

Answer-6(B):

2016 Cash Flow from Investing Activities: Fixed assets purchased (90,000) Net cash used in investing activities $ (90,000)

Answer-6(C):

2016 Cash Flow from financing Activities: Long term debt raised Dividend paid 100,000 (35,000) Net cash used in financing activities $ 65,000

Answer-6(D):

$ 75,000 Cindy and Robert (Rob) Castillo Statement of Cash Flows For the Year 2016 Cash Flow from Operating Activities: Net Income Adjustment to Reconcile Net Income to Net Cash Provided by (used for) Operating Activities: Depreciation expense 40,000 Increase in account receivable (80,000) Increase in inventory, WIP and FG (100,000) Increase in account payable 30,000 Increase in accruals 20,000 Increase in bank loans 10,000 Net cash flow from operating activities (5,000)| $ Cash Flow from Investing Activities: Fixed assets purchased (90,000) Net cash used in investing activities (90,000) Cash Flow from financing Activities: Long term debt raised Dividend paid 100,000 (35,000) Net cash used in financing activities Net decrease in cash and cash equivalents Beginning cash and cash equivalents Ending cash and cash equivalents $ $ $ 65,000 (30,000) 50,000 20,000