Medieval Adventures Company

Question 1:
Income Statement

31-Jan
28-Feb
31-Mar
30-Apr
31-May
30-Jun
31-Jul
31-Aug
30-Sep
31-Oct
Sales
55000
82500
110000
137500
165000
192500
220000
247500
275000
302500
Cost of Goods Sold
(35000)
(52500)
(70000)
(87500)
(105000)
(122500)
(140000)
(157500)
(175000)
(192500)
Gross Profit
20000
30000
40000
50000
60000
70000
80000
90000
100000
110000
Being in Business Cost
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
Net Income
10000
20000
30000
40000
50000
60000
70000
80000
90000
100000

Cash Flow Statement

31-Jan
28-Feb
31-Mar
30-Apr
31-May
30-Jun
31-Jul
31-Aug
30-Sep
31-Oct
Cash from Operations

Collections from Customers
27500
41250
55000
82500
110000
137500
165000
192500
220000
247500
Production Cost (Inventory)
(52500)
(70000)
(87500)
(105000)
(122500)
(140000)
(157500)
(175000)
(192500)
(210000)
Being in Business Costs
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
(10000)
Cash from Operations, Total
(35000)
(38750)
(42500)
(32500)
(22500)
(12500)
(2500)
7500
17500
27500

Cash from Financing Activity

Loan from Bank
0
0
0
2500
22500
12500
2500
0
0
0
Loan Repayment
0
0
0
0
0
0
0
(7500)
(17500)
(15000)
Cash from Financing Activity, Total
0
0
0
2500
22500
12500
2500
(7500)
(17500)
(15000)

Change in Cash
(35000)
(38750)
(42500)
(30000)
0
0
0
0
0
12500
Beginning Cash
146250
111250
72500
30000
0
0
0
0
0
0
Ending Cash
111250
72500
30000
0
0
0
0
0
0
12500

The required financial statements are shown above for months January-October. By examining the balance sheet we can see that the company will need extra funds in April, it will need a total of $40,000 to maintain its operations with a zero cash balance. July is the last month the company