INCOME STATEMENT

In Dollars
$
Particulars 2011 2012 2013

Grsoss Revenue (Note-1) 219000 8760000 13140000

less: underreporting (Note-2) 32850 1314000 1971000
less: commission (Note-2) 37230 1489200 2233800
Business Revenue 148920 5956800 8935200
less: Informal cost (Bribe) (Note-2) 29784 1191360 1787040
Net business revenue (A) 119136 4765440 7148160

less: Operating Cost

Technician salary 3600 120000 180000
staff salary 120000 325000 400000
Technical Know How Amortized 2667 2667 2667
Sales staff salary 36000 36000
Weekly testing 5200 208000 312000

Marketing 10000 25000 40000

Maintenance 5000 200000 300000
Brand ambassador (Note 4) 50000 50000 89352
Motor vehicle operating Expense 2500 65000 110000
Depreciation on filters (Note-3) 1333 33833 50500
Depreciation on Motorbikes (Note-3) 1500 50000 75000
Depreciation on trucks (Note-3) 2500 52500 75000
Interest 100000

Total operating expense (B) 204300 1268000 1670519

Net profit (A-B) -85164 3497440 5477641

 CASH FLOW STATEMENT
Particulars 2011 2012 2013
Cash flow from operating Activities
Revenue after underreporting 186150 7446000 11169000
less: commission 37230 1489200 2233800
less: informal cost 29784 1191360 1787040
less: Operating Expenses (Note-6) 246300 979000 1467352

Net Cash from Operating Activities (A) -127164 3786440 5680808

Cash flow from Investing Activities

Purchase of Filters & Technical know
how 60000 487500 250000
purchase of motorbikes 7500 242500 125000
purchase of trucks 12500 250000 112500

Net Cash Used in investing activities (B) 80000 980000 487500

Cash flow from Financing Activities

Capital Introduced 25000
External financing 200000
Bank Loan 1000000
Laon Repayment -1000000
Interest -100000

Net cash From Financing activities (C) 225000 -100000

Total Cash Generated (A-B+C) 17836 2706440 5193308

Year Ending Cash Balance 17836 2724276 7917584

 BALANCE SHEET

Liabilities 2011 2012 2013 Assets 2011 2012 2013

Capital Filters 20000 507500 757500
Owners
Equity 25000 25000 25000 less: Depreciation 1333 35167 85667
External
Financing 200000 200000 200000 Net value 18667 472333 671833
Retained
earnings (NP) -85164 3412276 8889917
Motorbike 7500 250000 375000
less: Depreciation 1500 51500 126500
Net value 6000 198500 248500

Trucks 12500 262500 375000

less: depreciation 2500 55000 130000

Net Value 10000 207500 245000

Brand Ambassador
advance 50000
Technical Know How
Blue Water Filtrs 37333 34667 32000
Cash 17836 2724276 7917584

139836 3637276 9114917 139836 3637276 9114917

Notes

Notes-1 Gross Business Receipts

Particulars 2011 2012 2013

A) No of Customers 150 150 150
B) Price/litre $0.08 $0.08 $0.08
C) No. of Vendors 50 2000 3000
Total Revenue 219000 876000 876000
(AxBxCx365)

Note 2: Cost Of Sales

a) Underreporting will be 15% of Gross Revenue

b) Commission paid to vendors @20% of Revenue less Underreporting
c) Informal cost i.e. Bribes paid @20% of Business Revenue

2011 2012 2013

Underreporting
@15% 32850 1314000 1971000
Commission @20% 37230 1489200 2233800
Bribes @20% 29784 1191360 1787040

Note 3- Depreciation

Depreciation Is calculated on Straight line Method (SLM)

Asset Life in years 2011 2012 2013

Slowsand Filters 15 1333 33833 50500
Motorcycles 5 1500 50000 75000
Flatbed Trucks 5 2500 52500 75000

Note 4- Brand Ambassador is to be paid 1% of business Receipts in Year 3

Note 5- One time amount Paid to Blue future filters are treated as Capital Expenditures,
hence they were amortized for period of 15 years

Note 6 Operating Expenses are excluding Depreciation, interest and legal Technical know
how amortization