Case 3 3 dispensers-of-california
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Transcript of Case 3 3 dispensers-of-california
Case 3-3Dispensers of California, Inc.
Group # 4Diana Lynn C. Ching
Cyma Edel S. AlbaRochelle R. de Guzman
Maikko Ella M. OlayaMarie France A. Cortez
Racquel Angelei L. CastanedaMichelle Gatdula
I. Introduction & Profit Plan
Peter Hynes - Created a new and improved commercial paint spray
Dispensers of California, Inc.- A corporation formed by Peter Hynes and his friends
- Was able to gain a patent for the paint spray with a legal life of 16 years
II. Transaction WorksheetThe diagram shows the impact of the different transactions Peter needs to consider for the business:
III. Trial Balance
IV. Statement of Cash Flow
Cash Balance as shown in the Ending Balance Sheet
V. Income Statement
Retained Earnings as shown in the Ending Balance Sheet
Patent was amortized over its projected useful life of 6 years because it was purchased rather than developed within the company.
Redesign cost expensed
No Inventory left at the end of the period
VI. Ending Balance Sheet
The Dispenser’s of California, Inc. Ending Balance Sheet reflects a Dual Aspect, where we find that the
Total Amount of Assets = Total Amount of Liabilities + Equity
VII. Conclusion/Recommendation
If you were one of Peter Hyne’s friends, would you invest your
money in this company?
☐ YES ☐ NO
VII. Conclusion/RecommendationWould you invest your money in this company? Considerations:☐ Reliability Projected Profit Plan and Financial Statements
☐ Return on Equity
☐ Return on Sales
☐ Current Ratio
= Net Income after TaxTotal Owners’ Equity
= $ 52,500$ 200,000
= 26.25%
✓
✓
= Net Income after Tax Total Revenue
= $ 52,500$ 598,500
= 8.77%✓
= Total Current AssetsTotal Current Liabilities
= $ 93,500 $ 22,500
= 4.16✓
THANK YOU