W14 Final Exam Spreadsheet Instructions Based on assumptions below, make a projected P&L, balance sheet and statement of cash flows for 3 months. After completing the projected financial statements, answer the questions below the balance sheet. Rick's Razors For the 3 months ended March 31, 2022 Assumptions January razor sales in units2,000 Days Receivable b Sale price of razor$4.00 Days Inventory b January Razor blade sales (packs of 5) in units2,000 Days Payable bas Sale price of razor blade$2.00 Equipment Life in Monthly unit sales growth rate for razors and Blades 1% Razor cost of goods sold per unit $2.15 Razor blade cost of goods sold per unit $0.89 Marketing expense as a % of current month's sales 15% Other expenses $1,500 Activity: 1 - In December Rick plans to open a bank account with his personal investment of$7,000 cash. 2 - In January Rick plans to open his doors for business. 3 - In January Rick plans to borrow $5,000 and buy $5,000 of equipment. 4, In March, Rick plans to buy $2,000 of additional equipment with cash. JanFeb Units sold - razors 2,0002,020 Units sold - razor blades 2,0002,020 P&L Statement Razor sales $8,000 $8,080 Razor blade sales 4,0004,040 Total Sales $12,000 $12,120 Razor cost of goods sold 4,3004,343 Razor blade cost of goods sold 1,7801,798 Total Cost of Goods Sold $6,080 $6,141 Gross Profit $5,920 $5,979 Expenses Marketing Expenses $1,800 $1,818 Other expenses 1,5001,500 Depreciation8383
Total Expenses $3,383 $3,401 Net Income$2,537 $2,578 Statement of Cash Flows JanFeb Operating Activities Net Income$2,537 $2,578 Changes in Cur. Assets and Liabilities Change in Accounts Receivable(3,200)(32) Change in Inventory(2,837)(28) Change in Accounts Payable1,6509 Non-cash expenses Depreciation8383 Cash flow from Operating Activities$(1,767) $2,610 Investing Activities Change in Equipment$(5,000)$- Cash flow from Investing Activities$(5,000)$- Financing Activities Change in Notes Payable$5,000 $- Change in Paid-in-Capital-- Less: Change in Owner's Withdrawal-- Cash flow from Financing Activities$5,000 $- Net increase in cash $(1,767) $2,610 Cash--beginning of month 7,0005,233 Cash--end of month $5,233 $7,843
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