THE PIZZA FOOD TRUCK

Kindly navigate to the next tab to start the exercise. The details of each mon
 THE PIZZA FOOD TRUCK

o start the exercise. The details of each month is present on a separate tab.
 COMPANY LAUNCH ON DECEMBER 20th

On December 20th, I invest my savings in a new business:

Shareholder investment: $5,000
On December 22nd, I visit a supermarket to buy the ingredients I need:
Food supply: $750
I enjoy a nice Christmas break for now. I'm excited to begin operations on January 1st!

CASH FLOW STATEMENT CASH FLOW STATEMENT

Cash beginning $0 Cash beginning $0

Cash in Cash in
Share capital $5,000 Share capital $200,000
Cash out Cash out
Food supply $750 Food supply $20,000
Cash end $4,250 Cash end $180,000

BALANCE SHEET END OF THE MONTH BALANCE SHEET END OF THE MONTH

ASSETS LIABILITIES & EQUITY ASSETS LIABILITIES & EQUITY

Inventory $750 Share capital $5,000 Inventory $20,000 Share capital $200,000
Cash $4,250 Cash $180,000
Total assets Total liabilities & equity $5,000 Total assets $200,000 Total liabili $200,000
 JANUARY

I rent a truck: $2,500

I sell: 500 pizzas
The selling price is: $10 /pizza (all customers pay in cash)
Besides the rental cost of the truck, I bear the following additional expenses:
Material cost: $1.50 /pizza (food bought in December)
Water & Electricity: $0.50 /pizza

PRODUCTION COST
Material cost $1.50 /pizza
Water & electricity $0.50 /pizza
Total $2.00 /pizza

INCOME STATEMENT CASH FLOW STATEMENT

Sales revenue $5,000 Cash beginning $4,250
- Cost of pizzas sold $1,000 Cash in
- Truck rental cost $2,500 Sales in cash $5,000
Monthly profit $1,500 Cash out
Water & electricity $250
Truck rental cost $2,500
Cash end $6,500

BALANCE SHEET END OF THE MONTH

ASSETS LIABILITIES & EQUITY
Inventory $0 Share capital $5,000
Cash $6,500 Profit January $1,500
Total assets $6,500 Total liabilities & equity $6,500
 FEBRUARY

I rent a truck: $2,500

I go back to the supermarket to purchase some more food:
Food supply: $5,000
I sell: 1 000 pizzas to individual customers who all pay in cash
I closed a deal for: 2 000 pizzas with a neighbouring company (payment terms: 30 days)
The selling price is: $10 /pizza for all customers (individuals & the neighbouring company)
Besides the rental cost of the truck, I bear the following additional expenses:
Material cost: $1.50 /pizza (food bought at the supermarket earlier this month)
Water & electricity: $0.50 /pizza
Part-time employee: $1,000

PRODUCTION COST Inventory

Material cost $1.50 /pizza Total $5000
Water & electricity $0.50 /pizza Cost for Pizza Sold $4,500
Total $2.00 /pizza Remaining Inventory $500
Remaining Inventory (#Pizza) 333

INCOME STATEMENT CASH FLOW STATEMENT

Sales revenue $30,000 Cash beginning $6,500
- Cost of pizzas sold $6,000 Cash in
- Part-time employee $1,000 Sales in cash $10,000
- Truck rental cost $2,500 Cash out
Monthly profit $20,500 Food supply $5,000
Water & electricity $1,500
Part-time employee $1,000
Truck rental cost $2,500
Cash end $6,500

BALANCE SHEET END OF THE MONTH

ASSETS LIABILITIES & EQUITY
Inventory $500 Share capital $5,000
Accounts receivable $20,000 Retained earnings $1,500
Cash $6,500 Profit February $20,500
Total assets $27,000 Total liabilities & equity $27,000
 MARCH

I buy the truck for: $36,000 (to be paid half in March and half in April)
I will use the truck for: 3 years in total
I visit the supermarket once more to purchase food:
Food supply: $5,000
I sell: 1 000 pizzas to individual customers who all pay in cash
Plus: 2 000 pizzas to a neighbouring company (payment terms: 30 days)
The selling price will be: $10 /pizza for all customers (individuals & the neighbouring company)
I bear the following additional expenses:
Material cost: $1.50 /pizza (past inventory & food just bought at the supermarket)
Water & electricity: $0.50 /pizza
Part-time employee: $1,000
Truck insurance: $300

PRODUCTION COST
Material cost $1.50 /pizza
Water & electricity $0.50 /pizza
Total $2.00 /pizza

INCOME STATEMENT CASH FLOW STATEMENT

Sales revenue $30,000 Cash beginning $6,500
- Cost of pizzas sold $6,000 Cash in
- Part-time employee $1,000 Acc. Receivable collection $20,000
- Truck insurance $300 Sales in cash $10,000
- Truck depreciation $1,000 Cash out
Monthly profit $21,700 Truck purchase $18,000
Food supply $5,000
Water & electricity $1,500
Part-time employee $1,000
Truck insurance $300
Cash end $10,700

BALANCE SHEET END OF THE MONTH

ASSETS LIABILITIES & EQUITY
Gross truck value $36,000 Share capital $5,000
- Acumulated depreciation $1,000 +Retained earnings $22,000
Net truck value $35,000 +Monthly profit $21,700
Inventory $1,000 Owners' equity $48,700
Accounts receivable $20,000
Cash $10,700 Debt to truck supplier $18,000
Total assets $66,700 Total liabilities & equity $66,700
 APRIL

I visit the supermarket to purchase food:

Food supply: $5,000
I sell: 4 000 pizzas to a neighbouring company
As of this month, new conditions apply when I'm doing business with this corporate customer:
Selling price: $10 /pizza (unchanged)
Payment terms: 60 days
I still use the truck bought in March to I run the operations and bear the following additional expenses:
Material cost: $1.50 /pizza
Water & electricity: $0.50 /pizza
Part-time employee: $1,000
Truck insurance: $300

PRODUCTION COST
Material cost $1.50 /pizza
Water & electricity $0.50 /pizza
Total $2.00 /pizza

INCOME STATEMENT CASH FLOW STATEMENT

Sales revenue $40,000 Cash beginning $10,700
- Cost of pizzas sold $8,000 Cash in
- Part-time employee $1,000 Acc. Receivable collection $20,000
- Truck insurance $300 Sales in cash $0
- Truck depreciation $1,000 Cash out $6,300
Monthly profit $29,700 Truck purchase (end) $18,000
Food supply $5,000
Water & electricity $2,000
Part-time employee $1,000
Truck insurance $300
Cash end $4,400

BALANCE SHEET END OF THE MONTH

ASSETS LIABILITIES & EQUITY
Gross truck value $36,000 Share capital $5,000
- Acumulated depreciation $2,000 +Retained earnings $43,700
Net truck value $34,000 +Monthly profit $29,700
Inventory $0 Owners' equity $78,400
Accounts receivable $40,000
Cash $4,400 Debt to truck supplier $0
Total assets $78,400 Total liabilities & equity $78,400
 COMPANY LAUNCH ON DECEMBER 20th

On December 20th, I invest my savings in a new business:

Shareholder investment: $5,000
On December 22nd, I visit a supermarket to buy the ingredients I need:
Food supply: $750
I enjoy a nice Christmas break for now. I'm excited to begin operations on January 1st!

CASH FLOW STATEMENT

Cash beginning $0
Cash in
Share capital $200,000
Cash out
Food supply $20,000
Cash end $180,000

BALANCE SHEET END OF THE MONTH

ASSETS LIABILITIES & EQUITY

Inventory $20,000 Share capital $200,000
Cash $180,000
Total assets $200,000 Total liabilities & equity $200,000
 JANUARY

I rent a truck: $2,500

I sell: 500 pizzas
The selling price is: $100 /pizza (all customers pay in cash)
Besides the rental cost of the truck, I bear the following additional expenses:
Material cost: $25.00 /pizza (food bought in December)
Water & Electricity: $15.00 /pizza

PRODUCTION COST
Material cost $25.00 /pizza
Water & electricity $15.00 /pizza 10000
Total $40.00 /pizza

INCOME STATEMENT CASH FLOW STATEMENT

Sales revenue $40,000 Cash beginning $180,000
- Cost of pizzas sold $16,000 Cash in
ads $8,000
- machine rental $5,000 Sales in cash $40,000
Monthly profit $11,000 Cash out
Water & electricity $6,000
ads $8,000
- machine rental $5,000
Cash end $201,000

BALANCE SHEET END OF THE MONTH

ASSETS LIABILITIES & EQUITY
Inventory $10,000 Share capital $200,000
Cash $201,000 Profit January $11,000
Total assets $211,000 Total liabilities & equity $211,000