SchedulesSchedule of SalesDECJANFEBMARAPR$500,000$600,000$700,000$800,000$600,000

1. Schedule of Expected Cash Collections:JANFEBMARQRTCollection of Cash Sales$180,000$210,000$240,000$630,000Credit Sales:Collected Month of Sale210,000245,000280,000735,000Collected Month after Sale175,000210,000245,000630,000Total Collections$565,000$665,000$765,000$1,995,000

2. Inventory Purchases Budget:JANFEBMARQRTBudgeted Cost of Goods Sold$330,000$385,000$440,000$1,155,000Add Desired Ending Inventory57,75066,00049,50049,500Total Inventory Needs387,750451,000489,5001,204,500Deduct Beginning Inventory100,00057,75066,000100,000Total Purchases$287,750$393,250$423,500$1,104,500

3. Schedule of Cash Disbursements - Inventory Purchases:JANFEBMARQRTInventory Purchases:Paid Month of Purchase$115,100$157,300$169,400$441,800Paid Month after Purchase110,000172,650235,950518,600Total Cash Disbursements$225,100$329,950$405,350$960,400

4. Schedule of Cash Disbursements - Operating Expenses:JANFEBMARQRTOperating Expenses:Salaries and Wages$170,000$190,000$210,000$570,000Shipping12,00014,00016,00042,000Advertising12,50012,50012,50037,500Total Cash Disbursements$194,500$216,500$238,500$649,500

5. Cash Budget:JANFEBMARQRTCash Balance, Beginning$100,000$100,000$183,258$100,000Add Cash Collections 565,000665,000765,0001,995,000Total Cash Available 665,000765,000948,2582,095,000Less Cash Disbursements:For Inventory Purchases 225,100329,950405,350960,400For Operating Expenses 194,500216,500238,500649,500For Land Purchases 180,000191,008371,008For Dividends 25,00025,000Total Cash Disbursements 599,600546,450859,8582,005,908Excess (Deficiency) of Cash 65,400218,55088,40089,092Financing:Borrowed from Bank 34,6000.011,60046,200Principal Repayment 0.0(34,600)0.0(34,600)Interest Paid 0.0(692)0.0(692)Cash Balance, Ending$100,000$183,258$100,000$100,000

6.Lolich CompanyIncome StatementFor the quarter ended March 31, 2015Sales$2,100,000Less: Variable costs Cost of goods sold1,155,000 Salaries and wages420,000 Shipping42,000Total variable costs1,617,000Contribution margin483,000Less: Fixed costs Salaries and wages150,000 Advertising37,500 Depreciation expense7,500 Interest expense808Total fixed costs195,808Net income$287,192

7.Lolich CompanyBalance SheetAs of March 31, 2015Assets:Cash$100,000Accounts Receivable280,000Inventory49,500Land and Equipment971,008Less: Accumulated Depreciation(167,500)Total Assets$1,233,008

Liabilities and Stockholders Equity:Accounts Payable$254,100Notes Payable11,600Interest Payable116Capital Stock500,000Retained Earnings467,192Total Liabilities and Stockholders Equity$1,233,008

Written Analysis

Based on the projections, the companys first quarter for the year 2015 will be very promising. Profit is expected to be higher than the previous year because the companys sales will increase by $100,000 every month. Operating expenses would also increase due to the increase in sales. There will be a need to borrow $34,600 from the bank in January and $11,600 in March to maintain a cash balance of $100,000. This is due to the increase in working capital needed to finance the increased sales. Inventory purchases would also increase every month due to the increase in sales.

The companys contribution margin is 23% which is sufficient enough to cover the fixed costs and generate a profit of $287,192 for the first quarter alone. The companys profit margin for the first quarter will be 14% which means that the company is very efficient and effective in controlling expenses as it could generate $ 0.14 of profit for every $1 of sales. The company will also declare and distribute dividends of $25,000 for the first quarter as the companys profit share distribution to the stockholders.

Overall, the companys performance and financial condition for the first quarter of 2015 will be very good and is a positive sign of a profitable and successful year ahead.

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