Toy World, Inc._spreadsheet - (Amounts in thousand of...

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Unformatted text preview: (Amounts in thousand of dollars) Annual Sales 10,000 COGS/Sales Margin Total $ Purchases $ Wages $ Seasonal Production 70.0% 7,000 3,000 4,000 Less direct labor savings 265 265 need to provide Less elimination of overtime wage premium 225 225 need to provide Level Production 6,510 3,000 3,510 calculate amounts under level production; what is estimated margin? Estimated margin under level production 65.1% Operating expenses Incurred evenly throughout the year Minimum cash balance 200 Credit line Maximum amount 2,000 Clean-up period 30 days Interest rate 9% p.a. Long-term debt Interest rate 9.625% Semi-annual principal payment 25 June & December Average collection period 60 days Purchases made one week in advance 1994 forecast 3,000 30% of sales Terms 30 days Monthly purchases 250 Capex amount = depreciation Table A Page 2 Table A: Condensed Income Statements, 1991-1993 (thousands of dollars) 1991 1992 1993 Net sales $5,213 $6,167 $7,967 Cost of goods sold 3,597 4,440 5,577 Gross profit $1,616 $1,727 $2,390 Operating expenses 1,199 1,542 1,912 Interest expense 68 75 85 Interest income 20 15 16 Profit before taxes $369 $125 $409 Federal income taxes 125 43 139 Net profit $244 $82 $270 Table B Page 3 Table B: Balance Sheet at December 31, 1993 (thousands of dollars) Cash $200 Accounts receivable 2,905 Inventory 586 Current assets $3,691 Plant and equipment, net 1,176 Total assets $4,867 Accounts payable $282 Notes payable, bank 752 Accrued taxes(a) 88 Long-term debt, current portion 50 Current liabilities $1,172 Long-term debt 400 Shareholders' equity 3,295 Total liabilities and shareholders' equity $4,867 (a)The company was required to make estimated tax payments on the 15th of April, June, September, and December. In 1993 it elected to base its estimated tax payments on the previous year's tax. The balance of $88,000 was due on March 15, 1994. Table C Page 4 Table C: Monthly Sales Data (thousands of dollars) Sales Total Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1993 Actual $7,967 $64 88 96 88 87 95 96 1,251 1,474 1,723 1,965 940 1994 Projected $10,000 $120 140 160 140 140 140 160 1,620 1,840 2,140 2,285 1,115 1,060 Exhibit 1 Page 5 Exhibit 1 Pro Forma Balance Sheets Under Seasonal Production, 1994 (thousands of dollars) Actual Dec. 31, Note 1993 Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec....
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This note was uploaded on 01/16/2012 for the course MBA 101 taught by Professor Wormer during the Spring '08 term at Indian Institute Of Management, Ahmedabad.

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Toy World, Inc._spreadsheet - (Amounts in thousand of...

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