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A new company, Apex, was started on December 1, 2013. Below are their sales forecast and other financial information.
A new company, Apex, was started on December 1, 2013. Below are their sales forecast and other financial information. Based on this information, provide an financial analysis that includes the following:
1) work on an income statement budget.
2) Work on a cash flow budget
3) Does the company have enough capitalization?
4) Which month does the company achieve positive cash flow?
January 2014 $100,000
...Each month thereafter
Cost of Goods Sold: 60% of sales
COGS cash disbursement 1 month prior to sale
No cash sales.
Receivables are collected as follows:
70% collected the following month of sales
20% two months after the sale
10% three months after the sale
Company has $250,000 in cash currently and a line of credit for $200,000