ACC 230 Week 6 Assignment PetMed Express, Inc.

ACC 230 Week 6 Assignment PetMed Express, Inc. - ANSWER KEY...

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ANSWER KEY PETMED EXPRESS, INC. 1. PetMed Express, Inc. Statement of Cash Flows Summary Analysis For the Years Ended March 31 2004 % 2003 % 2002 % Inflows: Cash from operations 1,105,595 36 970,301 62 476,024 18 Net proceeds from the sale of property and equipment 0 0 15,000 1 2,016,921 75 Proceeds from the exercise of stock options and warrants 1,999,345 64 580,836 37 0 0 Borrowings from loan obligations 0 0 0 0 205,327 7 Total Inflows 3,104,940 100.0 1,566,137 100.0 2,698,272 100.0 Outflows: Purchases of property and equipment 741,740 92 744,596 56 555,645 23 Purchases of intangible asset 0 0 365,000 28 0 Payments on the line of credit 0 0 141,214 11 0 Payments on loan obligation 68,443 8 68,442 5 0 Payments on capital lease obligation 0 0 0 0 247,209 11 Payments on mortgage payable 0 0 0 0 1,566,833 66 Total Outflows 810,183 100.0 1,319,252 100.0 2,369,687 100.0 Change in cash 2,294,757 246,885 328,585 PetMed Express has generated an increasing dollar amount of cash from operations (CFO) from 2002 to 2004, but CFO has been significantly smaller than the net income the firm has produced each year. Two noteworthy reasons for this are the constantly increasing Accounts Receivables and Inventory accounts. PetMed Express has also used large amounts of accounts payable to support the increase in accounts receivable and inventory.
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