MILESTONE 2 PROFORMA SHEETS

Peyton Approved Income Statement For Year Ended 12/31/2017 Bakery Sales Merchandise Sales Total Revenues Cost of Goods Sold - Baked Cost of Goods Sold - Merchandise Total Cost of Goods Sold Gross Profit Operating Expenses: Rent Expense Wages Expense Misc. Supplies Expense Business License Expense Misc. Expense Depreciation Expense Insurance Expense Advertising Expense Interest Expense Telephone Expense Gain/Loss on disposal of equipment Total Operating Expenses: Net Income 327,322.55 1,205.64 105,834.29 859.77 24,549.19 10,570.72 3,000.45 2,045.77 1,353.84 577.85 1,091.08 1,549.74 818.31 490.98 100.00 328,528.19 (105,594.05) 221,834.13 (45,357.95) 175,476.18 - Peyton Approved - Statement of Retained Earnings _ -__- 50,144.84 -__- 175,476.18 less Dividends: S 105,000.00 Ending Balance S 120,621.02 Peyton Approved Statement of cash Flow For Year Ended 12/31/2017 Net Income 175,476.18 Depreciation Expense 677.86 Loss on disposal of equipment 100.00 176,254.04 Increase in Accounts Receivable (25,886.91) Other Receivable - Insurance (700.00) Increase in Baking Supplies (11,362.84) - Increase in Merchandise inventory _ Increase in Prepaid Insurance (1,004.55) Increase in Misc. Supplies _- Increase in Accounts Payable _ Increase in Wages Payable _ customer deposit 1,000.00 Increase in Interest Payable 44.96 Operating Cash Flow 145,654.65 Cash Flow from Investments (6,000.00) Equipment Purchases Equipment Purchases Cash Flow from Investment (5,300.00) Cash Flow from Financing Repayment of Note Payable (10,000.00) Dividends Paid (105,000.00) Cash Flow from Financing (115,000.00) Net Cash Flow 25,354.65 Beginning Cash 43,165.39 Ending Cash Peyton Approved 68,520.04 Balance Sheet As of December 31, 2017 ASSETS LIABILITIES & OWNERS EQUITY CURRENT ASSEI'S CURRENT LIABILITIES Cash Accounts 23,437.11 Payable Accounts Receivable Wages 3,383.28 68,519. Payable 91 Other Receivable - 700.00 Interest 211.46 Insurance Payable Baking Supplies Customer 1,000.00 Deposit Merchandise Inventory Prepaid Rent 2,314.5 5 Prepaid Insurance 2,114.5 5 Misc. Supplies 170.49 TOTAL CURRENT TOTAL CURRENT LIABILITIES 28,031.85 ASSETS 162,059.31 Long Term Fixed Assets _ Long Term Liabilities Baking Equipment 12 0.00 00 Notes Payable 5, 000. 00 Accumulated Depreciation 4.06 44) TOTAL LONG TERM LIABILITIES 5,000.00 NET FIXED ASSETS 11, 593.56 TOTAL LIABILITIES 33, 963.10 Common Stock 2:0 ,0.00 00 Earnings 120, 621.0 Total Equity 140, 621.02 Total Asset Total Liabilities & Equity 173,652.87 173 652 87 I --_I__ PEYTON APPROVED TRIAL BALANCE As of December 31, 2017 Unadjusted trial balance Adjusting entries Adjusted trial balance Dr Cr ret Or re Dr Cr Cash 67,520.04 1,000.00 68, 520.04 Accounts Receivable 68,519.91 68, 519.91 Other Receivable - Insurance 700.00 700.00 Baking Supplies 15,506.70 3,000.00 18, 506.70 Merchandise Inventory 1,238.07 200.00 , 038.07 Consignment Inventory 200.00 200.0 Prepaid Rent 2, 114.55 2, 114.55 Prepaid Insurance 2, 114.55 2, 114.55 Misc. Supplies 170.49 170.49 Baking Equipment 14,000.00 2,000.00 12, 000.00 Accumulated Depreciation 1,606.44 1,200.00 406.44 Customer Deposit 1,000.00 1,000.00 Accounts Payable 20, 262.11 3, 175.00 3,437.11 Wages Payable 3, 383.28 3,383.28 Interest Payable 211.46 211.46 Notes Payable 5, 000.00 5,000.00 Common Stock 20, 000.00 20,000.00 Beginning Retained earnings 50, 144.84 50, 144.84 Dividends 105,000.00 105, 000.00 Bakery Sales 327, 322.55 327,322.55 Merchandise Sales 1, 205.64 1,205.64 Cost of Goods Sold - Baked 105,834.29 105, 834.29 Cost of Goods Sold - Merchandise 859.77 859.77 Rent Expense 4,549.19 4, 549.19 Wages Expense 10,670.72 10, 670.72 Misc. Supplies Expense 3,000.46 3, 000.46 Business License Expense 2, 045.77 2, 045.77 Misc. Expense 1,363.84 175.00 1, 538.84 Depreciation Expense 677.86 677.86 Insurance Expense ,091.08 1, 091.08 Advertising Expense 549.74 ,549.74 Interest Expense 818.31 818.31 Telephone Expense 490.98 490.98 Gain/Loss on disposal of equipment 100.00 100.00 429, 136.32 429, 136.32 6,375.00 6,375.00 432, 111.32 432, 111.32PEYTON APPROVED PRO FORMA INFORMATION The company is planning to open another location in 2018 . Prepare pro forma financials for 2018 for the new location using the following information: 1. Cost of leasing commercial space: $1,500 per month 2. Cost of new equipment: $15,000, purchased with a long-term note. Use straight line depreciation assuming a seven-year life, no residual value. Use full year's depreciation for the first year. Equipment purchase was financed with a long-term note. 3. Cost of hiring and training new employees: three at $25,000 each for the first year. 4. Except as noted below in 1, 2, 3, and 5, assets, current liabilities, sales, costs, and expenses are expected to be 80% of the existing store (from preliminary statements) except no stock. Retained earnings = net income 5. Cash: $7,000. Accounts receivable amount to 4.0 turns (accounts receivable turnover will be 4.0); inventory amount to show 3.0 turns (inventory turnover will be 3.0). No stock will be issued. Retained earnings are to equal net income. Additional financing of $5,000 will be long-term. Add remaining amount needed to balance into accounts payable. Peyton Approved Second Location Pro Forma Income Statement For Year Ending 12/31/2018\f