Volume

Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4

Revenue from Large Customers $2,370,194 $2,282,032 $2,254,913 $2,857,604
Revenue from Small Customers $890,340 $882,008 $890,749 $574,745
Total Revenue $3,260,534 $3,164,040 $3,145,662 $3,432,348
Variable Cost $1,859,119 $1,810,076 $1,804,446 $2,143,669
Gross Margin $1,401,415 $1,353,964 $1,341,216 $1,288,679
SG&A Expense $630,000 $630,000 $630,000 $530,000
R&D Expense $120,000 $120,000 $120,000 $90,000
Marketing Research Expenditures $130,000 $130,000 $130,000 $100,000
Other Operating Expense $130,421 $130,421 $130,421 $130,421
Total Operating Expense $1,010,421 $1,010,421 $1,010,421 $850,421
Net Income $390,994 $343,543 $330,795 $438,257
Cumulative Profit $0 $0 $0 $438,257

Percentages

Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4

Revenue from Large Customers 72.70% 72.10% 71.70% 83.30%
Revenue from Small Customers 27.30% 27.90% 28.30% 16.70%
Total Revenue 100.00% 100.00% 100.00% 100.00%
Variable Cost 57.00% 57.20% 57.40% 62.50%
Gross Margin 43.00% 42.80% 42.60% 37.50%
SG&A Expense 19.30% 19.90% 20.00% 15.40%
R&D Expense 3.70% 3.80% 3.80% 2.60%
Marketing Research Expenditures 4.00% 4.10% 4.10% 2.90%
Other Operating Expense 4.00% 4.10% 4.10% 3.80%
Total Operating Expense 31.00% 31.90% 32.10% 24.80%
Net Income 12.00% 10.90% 10.50% 12.80%
Cumulative Profit 0.00% 0.00% 0.00% 12.80%

Segment A

Very Satisfied

"Our largest client just gave us excellent

feedback regarding our breakthrough
research, which was made possible by the
high quality of your inertial motion capture
technology. This company is a pioneer in
human-machine interaction, a leader in the
manufacturing field. Without the incredible
accuracy of the accelerometers within your
sensors, we should never be able to keep
their business."

Segment B

Neutral
"We recently bought a couple of large
packages from you. The products meet our
basic requirements, but I would have
expected more time from your sales reps.
Our basic questions were answered, but for
future orders, I would hope to get more
insight into market trends from your staff."

Segment C

Dissatisfied

"When first ordering from you, we were

willing to pay higher prices because your
package performed perfectly during the
quality testing process. However, our QA
team has rejected several sensors since then.
This is unacceptable."

Segment D

Very Satisfied

"I'm really pleased that you've always

delivered motors in the large volumes that
I've ordered which allows me to offer a lower
price to my own customers. And your timely
deliveries have allowed me to avoid
expensive late fulfillment charges."

Small Customers

Very Satisfied

"I wanted to say thank you regarding your

post-sales customer service. Even though we
are a small customer, after we found some
defective sensors in our last order, you
replaced them with no questions asked."
 Per Unit

Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4

Revenue from Large Customers $124.90 $124.75 $124.71 $113.28
Revenue from Small Customers $124.96 $124.96 $124.96 $122.20
Total Revenue $124.92 $124.81 $124.78 $114.68
Variable Cost $71.23 $71.40 $71.58 $71.62
Gross Margin $53.69 $53.41 $53.20 $43.06
SG&A Expense $24.14 $24.85 $24.99 $17.71
R&D Expense $4.60 $4.73 $4.76 $3.01
Marketing Research Expenditures $4.98 $5.13 $5.16 $3.34
Other Operating Expense $5.00 $5.14 $5.17 $4.36
Total Operating Expense $38.71 $39.86 $40.08 $28.41
Net Income $14.98 $13.55 $13.12 $14.64
Cumulative Profit $0.00 $0.00 $0.00 $14.64

Gross Margin Detail

Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4

Segment A $509,824 $486,385 $474,410 $410,187
Segment B $124,018 $108,799 $104,758 $94,262
Segment C $111,170 $105,496 $104,468 $111,184
Segment D $273,559 $275,253 $277,048 $435,173
Small Customers $382,846 $378,030 $380,532 $237,874
Volume
Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4 Y2, Q1 Y2, Q2
Revenue from Large Customers $2,370,194 $2,282,032 $2,254,913 $2,857,604 $3,005,480 $3,322,172
Revenue from Small Customers $890,340 $882,008 $890,749 $574,745 $431,246 $407,751
Total Revenue $3,260,534 $3,164,040 $3,145,662 $3,432,348 $3,436,727 $3,729,923
Variable Cost $1,859,119 $1,810,076 $1,804,446 $2,143,669 $2,104,774 $2,411,384
Gross Margin $1,401,415 $1,353,964 $1,341,216 $1,288,679 $1,331,952 $1,318,540
SG&A Expense $630,000 $630,000 $630,000 $530,000 $520,000 $570,000
R&D Expense $120,000 $120,000 $120,000 $90,000 $120,000 $130,000
Marketing Research Expenditures $130,000 $130,000 $130,000 $100,000 $100,000 $120,000
Other Operating Expense $130,421 $130,421 $130,421 $130,421 $130,421 $130,421
Total Operating Expense $1,010,421 $1,010,421 $1,010,421 $850,421 $870,421 $950,421
Net Income $390,994 $343,543 $330,795 $438,257 $461,531 $368,118
Cumulative Profit $0 $0 $0 $438,257 $899,788 $1,267,907

Percentages

Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4 Y2, Q1 Y2, Q2

Revenue from Large Customers 72.70% 72.10% 71.70% 83.30% 87.50% 89.10%
Revenue from Small Customers 27.30% 27.90% 28.30% 16.70% 12.50% 10.90%
Total Revenue 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Variable Cost 57.00% 57.20% 57.40% 62.50% 61.20% 64.60%
Gross Margin 43.00% 42.80% 42.60% 37.50% 38.80% 35.40%
SG&A Expense 19.30% 19.90% 20.00% 15.40% 15.10% 15.30%
R&D Expense 3.70% 3.80% 3.80% 2.60% 3.50% 3.50%
Marketing Research Expenditures 4.00% 4.10% 4.10% 2.90% 2.90% 3.20%
Other Operating Expense 4.00% 4.10% 4.10% 3.80% 3.80% 3.50%
Total Operating Expense 31.00% 31.90% 32.10% 24.80% 25.30% 25.50%
Net Income 12.00% 10.90% 10.50% 12.80% 13.40% 9.90%
Cumulative Profit 0.00% 0.00% 0.00% 12.80% 26.20% 34.00%
 Per Unit
Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4
Revenue from Large Customers $124.90 $124.75 $124.71 $113.28
Revenue from Small Customers $124.96 $124.96 $124.96 $122.20
Total Revenue $124.92 $124.81 $124.78 $114.68
Variable Cost $71.23 $71.40 $71.58 $71.62
Gross Margin $53.69 $53.41 $53.20 $43.06
SG&A Expense $24.14 $24.85 $24.99 $17.71
R&D Expense $4.60 $4.73 $4.76 $3.01
Marketing Research Expenditures $4.98 $5.13 $5.16 $3.34
Other Operating Expense $5.00 $5.14 $5.17 $4.36
Total Operating Expense $38.71 $39.86 $40.08 $28.41
Net Income $14.98 $13.55 $13.12 $14.64
Cumulative Profit $0.00 $0.00 $0.00 $14.64

Gross Margin Detail

Y1, Q1 Y1, Q2 Y1, Q3 Y1, Q4

Segment A $509,824 $486,385 $474,410 $410,187
Segment B $124,018 $108,799 $104,758 $94,262
Segment C $111,170 $105,496 $104,468 $111,184
Segment D $273,559 $275,253 $277,048 $435,173
Small Customers $382,846 $378,030 $380,532 $237,874
Y2, Q1 Y2, Q2
$117.92 $115.03
$121.50 $110.88
$118.36 $114.56
$72.49 $74.06
$45.87 $40.50
$17.91 $17.51
$4.13 $3.99
$3.44 $3.69
$4.49 $4.01
$29.98 $29.19
$15.89 $11.31
$30.99 $38.94

Y2, Q1 Y2, Q2
$462,175 $471,724
$119,474 $105,110
$141,318 $158,350
$435,022 $447,964
$173,963 $135,392