Cash is King Accountants
Memo
To: Stockholders of Chemalite, Inc.
From: Jon Smart
CC: Tim Mofit
Date: 4/12/2008
Re: Financial Performance of Chemalite, Inc.
The purpose of this memo is to present the financial performance of Chemalite, Inc. to the stockholders of the company.
Analysis
Chemalite, Inc. is a new company that is performing very well and additionally has a very bright future. The following topics will explain:
• Assets
• Cash Flow
• Income
• Future
Assets: Current assets total $439,375.00 with $113,000.00 of that being liquid cash. The company has no liabilities, meaning that it owes no money.
Cash Flow: A big concern for all of the stockholders was the negative cash flows that they observed. All of the negative cash flows for the period are attributed to investing and the sale/purchase of inventory which should in turn result in additional positive cash flow. In addition, there was a positive change in cash for the total period of $113,000.00.
Income: The Company has a positive net income of $39,375.00 which is approximately five percent of net sales.
Future: The future looks bright for Chemalite, Inc. as there is a guaranteed $90,000.00 purchase to get the next year started. In addition, with no liabilities, the company can look to invest much further into the production of their product.
Conclusion
Chemalite, Inc. is performing extremely well given the immaturity of its growth. They have no liabilities and all cash expenses were spent on the betterment of the company and its growth. There is a positive income coming to the company coupled with the fact that they are already receiving commitments for sales into the next year. If it could improve on one thing, as all compani ...