Chemalite, Inc.

(B)
Balance sheet as at December 31, 1991 and 1992
Dec. 31,
Dec. 31,
Assets
1992
1991
(Pro-forma)
(Actual)
Cash
9,490
1,13,000
Accounts Receivable
1,39,530
69,500
Inventories-raw materials
75,450
55,000
Inventories-finished goods
1,04,680
0
Prepaid Insurance
65,000
0

O
O
O
O

CA
CA
CA
CA

I
O
I

NCA
NCA

Property, Plant and Equipment

Accumulated Depreciation
Land

NCA

Patent
Totat assets

Q1

Indirect Method
Consolidated statements of Cash Flows for Chemalite, Inc (B):
1992

-1,03,510
70,030
20,450
1,04,680
65,000

11,20,000
-56,000
2,50,000

2,12,500
-10,625
0

9,07,500
-45,375
2,50,000

75,000

1,00,000

-25,000

17,83,150

5,39,375

12,43,775

Operating Activities
Net Income (PAT)

1,18,995
1,18,995

Accumulated Depreciation
Gain on sale of Equipment
Cash Effect of these changes:
Accounts Receivable
Inventories-raw materials
Inventories-finished goods
Prepaid Insurance
Taxes Payable
Deferred income taxes

61,625
-24,250

-70,030
-20,450
1,04,680
-65,000
-950
26,730

Liabilities and Owners' Equity

O

CL

Taxes Payable

CL

Short term Debt

CL

Deferred income taxes

CL

NCL

F
F
F

-1,97,005
9,950

10,900

-950

2,00,000

2,00,000

26,730

26,730

Notes Payable (10%)

4,25,000

4,25,000

Long-term Debt (10%)

5,10,000

5,10,000

Dividends Payable
Common Stock
Retained Earnings
Treasury Stock

12,000
5,00,000
1,25,470
-26,000

10,000
5,00,000
18,475
0

2,000
0
1,06,995
-26,000

17,83,150

5,39,375

12,43,775

Total liabilities and owner's

equity

Investment Activities
Property, Plant and Equipment
Land
Patent

9,07,500
2,50,000
25,000
11,32,500

Financing Activities
Short term Debt
Long-term Debt (10%)
Notes Payable (10%)

200000
510000
4,25,000

Income Statement for the years ended Dec. 31, 1991 & 1992
Dec. 31,
Dec. 31,
1992
1991
(Pro-forma)
(Actual)
Sales
18,86,250
7,54,500
Material
-4,52,700
-1,95,000
Labor
-6,60,000
-2,75,000

O
O
O
O
O
O

Dividends Payable
Common Stock
Treasury Stock

-2,000
0
-26,000

11,07,000
11,31,750
-2,57,700
-3,85,000

Rent
Utilities
Depreciation
Gross Margin

-25,000
-82,000
-61,625
6,04,925

-50,000
-30,000
-10,625
1,93,875

25,000
-52,000
-51,000
4,11,050

Advertising
Research & Development
Insurance
Amortization of Patent
Selling & Admin. Expenses
Gain on sale of Equipment
Interest Expense
Prototypes
Legal Fees

-70,000
-63,250
-32,500
-25,000
-1,95,750
24,250
-58,750
0
0

-22,500
0
0
-25,000
-75,000
0
-750
-23,750
-7,500

-47,500
-63,250
-32,500
0
-1,20,750
24,250
-58,000
23,750
7,500

Income before taxes

Income taxes

1,83,925
-64,930

39,375
-10,900

1,44,550
-54,030

Net Income

1,18,995

28,475

90,520

Incr. / Decr. In Cash Balance

Cash available at beginning
Cash available at Ending

-1,03,510
1,13,000
9,490