All values are in USD '$'

Net Cash flow from operating activities

Net income 118995
Noncash expenses, revenues, gains and losses in income
Depreciation 61625
Accounts Receivable -70030
Raw Materials Cost -20450
Amortisation 25000
Taxes payable -950
Inventory Finished goods -104680
Depreciation on finished goods 5000
Gain on sale of equipment -24250
Deferred income tax 26730
Prepaid Insurance -65000
Net Cash Flow from operating activities -48010
Cash Flow from investing activities
New equipment bought half paid -300000
New land bought half paid -125000
New Machine bought -520000
Selling of old machine 215500
Net cash flow from investing activities -729500
Cash Flow from Financing activities
Cash dividend paid -10000
Share purchased from investor -26000
Short term debt 200000
Long term debt 510000
Net Cash Flow from financing activity 674000
Net increase or decrease in cash -103510
Roll No: 038epgp11
Name : Swarnabha Seth FRA Assignment 1
Chemlite Cash Flow Statement
All values are in USD '$'
Cash Flow from Operating Activities
Cash collection 1816220
Cash payments (purchases and OPEX)
Materials -473150
Labor -660000
Inventory -99680
Rent -25000
Utilities -82000
Advertising -70000
R&D -63250
Insurance -97500
Selling and administration expense -195750
Interest -58750
Taxes Paid -39150
Total cash payments -1864230
Net cash provided by operating activities -48010
Cash flows from Investing Activities
Purchase of hard assets (machinery) -945000
Sold Existing Equipment 215500
Total Cash flows from investing -729500
Cash flows from Financing Activities
Long-term Debt 510000
Short-term Debt 200000
Stock buyback -26000
Dividents Paid -10000
Total cash flow from financing 674000
Cash Summary
Net Change in Cash -103510
Cash on January 1, 1992 113000
Cash on December 31, 1992 9490
Chemlite Cash Flow Statement
Name : Swarnabha Seth FRA Assignment 1
Roll No: 038epgp11
All values are in USD '$'
What are the main sources and uses of cash?
Sources of cash
Financing activities that is Short term and Long term debt
Investing activities - activities that is Selling of old equipments
Uses of cash
Operating activties - Raw materials
Operating Activities - Inventory of finished goods
Financing Activities - New investments made
Financing activities - cash dividend Paid
What would you recommend to Alexander?
Chemalite is in a situation where cash outflow during the period are higher than the cash inflows
during the same period. As this is a forecasted cashflow, Alexander needs to start worrying about
the cash position towards end of December from now onwards . The uses of cash is on higher side
and mainly due to large investment into inventory.
Chemalite is trying to overcome the situation by arranging long termand short term debt. However,
this might not be
useful since it will result in increase in higher liability and increase in interest payable there of.
Alexander should
adapt a "conservative" approach and cut down on spending in terms of new equipments.As per the
income statement there is a significant increase in revenue so the company is doing well in terms of
generating sales. Now lets see the few ratios: Cash realization ratio = cash generated by
operations/net income = -0.5. The company has to work hard in terms of realizing the cash. Ratio of
cash generated by operations to total debt = -0.8 shows that the company's credit worthiness is not
good and it may not get further loans
Name : Swarnabha Seth FRA Assignment 1
Roll No: 038epgp11