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Magma Minerals Case Study

The document summarizes the estimated cash flows for 8 months of a tolling company. It projects tolling fees, revenues, and cash inflows and outflows from operations, investing, and financing activities. Key details include a $620,450 loan due in May, fuel and labor costs estimated as percentages of tolling fees and revenues, and equipment purchases of $278,000 in March. The net cash flow is projected to go from negative in February to over $700,000 positive by August.

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Joyce De Luna
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567 views6 pages

Magma Minerals Case Study

The document summarizes the estimated cash flows for 8 months of a tolling company. It projects tolling fees, revenues, and cash inflows and outflows from operations, investing, and financing activities. Key details include a $620,450 loan due in May, fuel and labor costs estimated as percentages of tolling fees and revenues, and equipment purchases of $278,000 in March. The net cash flow is projected to go from negative in February to over $700,000 positive by August.

Uploaded by

Joyce De Luna
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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CASH FORECAST FOR 8 MONTHS

Feb Mar Apr May


Estimated Tolling fees 900,000.00 975,000.00 1,125,000.00 2,200,000.00

CASH INFLOWS
Tolling Contract Revenue 450,000.00 757,500.00 1,035,000.00 1,632,500.00
Total Inflows 450,000.00 757,500.00 1,035,000.00 1,632,500.00

CASH OUTFLOWS
Cash flow from Operation
Fuel (10% of tolling fee per month) 90,000.00 97,500.00 112,500.00 220,000.00
Labor(8% of tolling contract revenues
per month) 36,000.00 60,600.00 82,800.00 130,600.00
Maintenance(5% tolling contract
revenue) 22,500.00 37,875.00 51,750.00 81,625.00
Salaries and Adminitrative staff and
sundry expenses 195,000.00 195,000.00 195,000.00 195,000.00
Depreciation expenses 129,000.00 129,000.00 129,000.00 129,000.00
Cash flow from Investing
Remaining balance to
equipment(March) 278,000.00
Cash flow from Financing
Loan 620,450.00
Total Outflows 472,500.00 797,975.00 571,050.00 1,376,675.00

Net Cash flow (22,500.00) (40,475.00) 463,950.00 255,825.00

Opening Balance 50,467.00 27,967.00 (12,508.00) 451,442.00


Closing Balance 27,967.00 (12,508.00) 451,442.00 707,267.00
Jun Jul Aug Sep Total
1,050,000.00 900,000.00 600,000.00 1,850,000.00 9,600,000.00
*tolling contract - 50% paid month sale,
*tax- 35% of income; payable end of the
1,410,000.00 1,205,000.00 780,000.00 1,285,000.00 8,555,000.00
1,410,000.00 1,205,000.00 780,000.00 1,285,000.00 *5 year term loan from First Developme
*To keep 150,000 in bank
* Loan due on May 30 - 620, 450

105,000.00 90,000.00 60,000.00 185,000.00 960,000.00 * cash balance -50, 467

112,800.00 96,400.00 62,400.00 102,800.00 684,400.00 *acceleration clause- if the company ren

70,500.00 60,250.00 39,000.00 64,250.00 427,750.00

195,000.00 195,000.00 195,000.00 195,000.00 1,560,000.00


129,000.00 129,000.00 129,000.00 129,000.00 1,032,000.00

278,000.00

620,450.00 1,240,900.00
612,300.00 570,650.00 485,400.00 1,296,500.00 6,183,050.00

797,700.00 634,350.00 294,600.00 (11,500.00)

707,267.00 1,504,967.00 2,139,317.00 2,433,917.00 7,302,836.00


1,504,967.00 2,139,317.00 2,433,917.00 2,422,417.00 9,674,786.00
ontract - 50% paid month sale, 30% paid in the following sales, 20% in the next 2 months
of income; payable end of the quarter

rm loan from First Development Bank due on May 30


150,000 in bank
e on May 30 - 620, 450

ance -50, 467

tion clause- if the company reneged on itsamortization schedule, the balance of the loan would become due anddemandable
anddemandable
Income Statement
for Eight Months

Feb Mar Apr May


Estimated Tolling fees 900,000.00 975,000.00 1,125,000.00 2,200,000.00
Tolling Contract Revenue 450,000.00 487,500.00 562,500.00 1,100,000.00
Cost of good sold
Direct Materials 90,000.00 97,500.00 112,500.00 220,000.00
Direct Labor 36,000.00 39,000.00 45,000.00 88,000.00
Variable manufacturing cost 22,500.00 24,375.00 28,125.00 55,000.00
Total Cost of good sold 148,500.00 160,875.00 185,625.00 363,000.00

Gross profit 301,500.00 326,625.00 376,875.00 737,000.00


Selling and Administrative expense 195,000.00 195,000.00 195,000.00 195,000.00
Deperation Expenses 129,000.00 129,000.00 129,000.00 129,000.00
Operating Income(Income before tax) (22,500.00) 2,625.00 52,875.00 413,000.00
Income Tax (at35%) 0 918.75 18,506.25 144,550.00

Net Income (22,500.00) 1,706.25 34,368.75 268,450.00


Jun Jul Aug Sep Total
1,050,000.00 900,000.00 600,000.00 1,850,000.00 9,600,000.00
525,000.00 450,000.00 300,000.00 925,000.00 4,800,000.00

105,000.00 90,000.00 60,000.00 185,000.00 480,000.00


42,000.00 36,000.00 24,000.00 74,000.00 384000
26,250.00 22,500.00 15,000.00 46,250.00 240,000.00
173,250.00 148,500.00 99,000.00 305,250.00 1,104,000.00

351,750.00 301,500.00 201,000.00 619,750.00 1,344,000.00


195,000.00 195,000.00 195,000.00 195,000.00 1,560,000.00
129,000.00 129,000.00 129,000.00 129,000.00 1,032,000.00
27,750.00 (22,500.00) (123,000.00) 295,750.00 624,000.00
9,712.50 0 0 103,512.50 277,200.00

18,037.50 (22,500.00) (123,000.00) 192,237.50 346,800.00

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