6 charts and Graphs

Production Analysis C97341 Round: 1Dec. 31, 2019

Name Primary

Segment Units Sold

Unit Inven

tory Revision

Date Age

Dec.31 MTBF Pfmn

Coord Size

Coord Price Material

Cost Labor

Cost Contr. Marg.

2nd Shift

& Over-

time

Auto mation

Next Round

Capacity Next

Round Plant

Utiliz. Able Trad 809 469 11/21/2015 4.1 17500 5.5 14.5 $26.00 $10.65 $7.85 22% 0% 4.0 1,800 61% Acre Low 1,819 22 12/20/2019 2.8 15000 2.5 15.5 $21.00 $8.01 $7.46 29% 30% 5.0 1,400 129% Adam High 452 14 4/19/2017 2.7 23000 8.0 12.0 $36.00 $14.84 $8.97 32% 0% 3.0 900 47% Aft Pfmn 553 0 3/29/2019 2.1 25000 9.4 15.0 $31.00 $14.97 $8.97 21% 0% 3.0 600 79% Agape Size 348 91 5/24/2016 3.6 19000 4.0 11.0 $31.00 $12.60 $8.97 27% 0% 3.0 600 63%

Baker Trad 837 0 4/24/2019 2.4 14000 5.6 14.4 $29.00 $9.70 $7.80 37% 0% 5.0 800 81% Bead Low 976 40 6/7/2019 3.1 12000 3.0 16.5 $22.50 $6.72 $6.68 38% 0% 6.0 1,000 98% Bid High 300 0 12/5/2019 1.4 20000 9.0 11.0 $38.50 $14.96 $8.91 37% 0% 4.0 300 86% Bold Pfmn 227 0 4/24/2019 2.1 27000 9.6 15.9 $33.50 $15.43 $8.91 26% 0% 4.0 300 50% Buddy Size 237 0 6/5/2019 2.1 16000 4.1 10.4 $33.50 $12.13 $8.91 35% 0% 4.0 200 87%

Cake Trad 1,333 526 9/1/2019 2.2 15000 6.2 13.8 $27.50 $10.61 $7.85 28% 0% 4.5 1,800 93% Cedar Low 2,328 0 1/15/2019 5.6 13000 3.0 17.0 $21.00 $6.75 $7.98 28% 65% 5.5 1,900 164% Cid High 520 102 1/5/2020 2.7 23000 8.0 12.0 $39.50 $14.84 $8.97 37% 0% 3.0 900 65% Coat Pfmn 468 153 12/11/2019 1.8 25000 10.9 14.9 $34.50 $15.98 $8.97 27% 0% 3.0 600 91% Cure Size 425 97 12/25/2019 1.8 19000 4.5 9.4 $34.50 $13.80 $8.97 34% 0% 3.0 600 77%

Daze Trad 1,556 514 3/19/2019 2.4 17500 5.8 14.5 $28.00 $10.80 $8.05 29% 6% 5.0 1,818 105% Dell Low 1,064 559 10/11/2019 2.9 14000 2.3 18.0 $24.00 $6.19 $7.13 37% 14% 6.0 1,414 113% Dixie High 425 605 5/15/2020 2.7 23000 8.0 12.0 $38.00 $14.84 $9.40 24% 11% 4.0 909 110% Dot Pfmn 544 177 9/19/2019 1.9 26000 10.6 15.3 $30.00 $15.96 $9.30 14% 8% 4.0 606 107% Dune Size 534 202 10/25/2019 1.9 19500 4.5 9.7 $30.00 $13.76 $9.47 21% 13% 4.0 606 112%

Eat Trad 1,588 37 3/17/2019 2.4 16500 5.6 14.5 $27.50 $10.40 $7.98 31% 4% 5.0 1,400 103% Ebb Low 2,564 0 1/15/2019 5.6 13000 3.0 17.0 $20.00 $6.75 $8.16 24% 82% 6.0 1,400 180% Echo High 384 102 12/23/2019 1.4 17000 7.0 12.9 $39.50 $12.08 $8.97 37% 0% 4.0 900 50% Edge Pfmn 325 0 6/29/2016 3.5 25000 9.4 15.5 $34.50 $14.81 $8.97 29% 0% 3.0 600 41% Egg Size 314 46 12/23/2020 3.6 19000 4.0 11.0 $34.50 $12.60 $8.97 35% 0% 3.0 600 50%

Fast Trad 1,537 38 3/3/2019 2.5 17500 5.6 14.5 $29.50 $10.70 $8.38 34% 17% 4.0 1,200 116% Feat Low 1,821 0 1/15/2019 5.6 13000 3.0 17.0 $22.00 $6.75 $8.14 31% 80% 5.0 1,000 178% Fist High 540 45 12/22/2019 1.4 24000 9.1 10.9 $39.50 $16.26 $9.35 37% 10% 3.0 500 109% Foam Pfmn 467 7 11/10/2019 1.8 26000 10.6 14.8 $34.50 $16.11 $8.97 29% 0% 4.0 600 66% Fume Size 388 21 12/10/2019 1.8 19000 4.7 9.6 $34.50 $13.73 $8.97 35% 0% 4.0 600 58%

CAPSTONE ® COURIER Page 4

Traditional Segment Analysis C97341 Round: 1Dec. 31, 2019

Traditional Statistics Total Industry Unit Demand 8,067 Actual Industry Unit Sales |8,067 Segment % of Total Industry |31.4%

Next Year's Segment Growth Rate |9.2%

Traditional Customer Buying Criteria Expectations Importance

1. Age Ideal Age = 2.0 47% 2. Price $19.50 - 29.50 23% 3. Ideal Position Pfmn 5.7 Size 14.3 21% 4. Reliability MTBF 14000-19000 9%

Top Products in Traditional Segment

Name Market Share

Units Sold to

Seg Revision Date

Stock Out

Pfmn Coord

Size Coord

List Price MTBF

Age Dec.31

Promo Budget

Cust. Aware- ness

Sales Budget

Cust. Access-

ibility

Dec. Cust

Survey Eat 19% 1,542 3/17/2019 5.6 14.5 $27.50 16500 2.44 $1,050 60% $1,015 51% 33 Daze 19% 1,517 3/19/2019 5.8 14.5 $28.00 17500 2.44 $1,000 58% $1,000 51% 33 Fast 18% 1,483 3/3/2019 5.6 14.5 $29.50 17500 2.46 $1,100 61% $1,175 54% 31 Cake 16% 1,285 9/1/2019 6.2 13.8 $27.50 15000 2.21 $2,000 82% $2,000 67% 42 Baker 10% 819 4/24/2019 YES 5.6 14.4 $29.00 14000 2.39 $1,000 58% $1,000 51% 27 Able 9% 743 11/21/2015 5.5 14.5 $26.00 17500 4.10 $1,000 58% $1,000 51% 11 Bead 2% 182 6/7/2019 3.0 16.5 $22.50 12000 3.08 $1,100 59% $1,000 51% 3 Acre 1% 120 12/20/2019 2.5 15.5 $21.00 15000 2.81 $900 53% $900 51% 7 Cedar 1% 100 1/15/2019 YES 3.0 17.0 $21.00 13000 5.60 $2,000 80% $2,000 67% 1 Ebb 1% 97 1/15/2019 YES 3.0 17.0 $20.00 13000 5.60 $1,050 58% $1,015 51% 1 Feat 1% 76 1/15/2019 YES 3.0 17.0 $22.00 13000 5.60 $1,100 59% $1,175 54% 0 Dell 1% 58 10/11/2019 2.3 18.0 $24.00 14000 2.91 $900 53% $900 51% 0

CAPSTONE ® COURIER Page 5

Low End Segment Analysis C97341 Round: 1Dec. 31, 2019

Low End Statistics Total Industry Unit Demand 10,009 Actual Industry Unit Sales |10,009 Segment % of Total Industry |39.0%

Next Year's Segment Growth Rate |11.7%

Low End Customer Buying Criteria Expectations Importance

1. Price $14.50 - 24.50 53% 2. Age Ideal Age = 7.0 24% 3. Ideal Position Pfmn 2.2 Size 17.8 16% 4. Reliability MTBF 12000-17000 7%

Top Products in Low End Segment

Name Market Share

Units Sold to

Seg Revision Date

Stock Out

Pfmn Coord

Size Coord

List Price MTBF

Age Dec.31

Promo Budget

Cust. Aware- ness

Sales Budget

Cust. Access-

ibility

Dec. Cust

Survey Ebb 25% 2,467 1/15/2019 YES 3.0 17.0 $20.00 13000 5.60 $1,050 58% $1,015 35% 18 Cedar 22% 2,228 1/15/2019 YES 3.0 17.0 $21.00 13000 5.60 $2,000 80% $2,000 50% 20 Feat 17% 1,745 1/15/2019 YES 3.0 17.0 $22.00 13000 5.60 $1,100 59% $1,175 37% 13 Acre 17% 1,699 12/20/2019 2.5 15.5 $21.00 15000 2.81 $900 53% $900 34% 7 Dell 10% 1,006 10/11/2019 2.3 18.0 $24.00 14000 2.91 $900 53% $900 33% 6 Bead 8% 794 6/7/2019 3.0 16.5 $22.50 12000 3.08 $1,100 59% $1,000 35% 5 Able 0% 46 11/21/2015 5.5 14.5 $26.00 17500 4.10 $1,000 58% $1,000 34% 1 Eat 0% 11 3/17/2019 5.6 14.5 $27.50 16500 2.44 $1,050 60% $1,015 35% 0 Cake 0% 9 9/1/2019 6.2 13.8 $27.50 15000 2.21 $2,000 82% $2,000 50% 0 Daze 0% 4 3/19/2019 5.8 14.5 $28.00 17500 2.44 $1,000 58% $1,000 33% 0

CAPSTONE ® COURIER Page 6

High End Segment Analysis C97341 Round: 1Dec. 31, 2019

High End Statistics Total Industry Unit Demand 2,967 Actual Industry Unit Sales |2,967 Segment % of Total Industry |11.6%

Next Year's Segment Growth Rate |16.2%

High End Customer Buying Criteria Expectations Importance

1. Ideal Position Pfmn 9.8 Size 10.2 43% 2. Age Ideal Age = 0.0 29% 3. Reliability MTBF 20000-25000 19% 4. Price $29.50 - 39.50 9%

Top Products in High End Segment

Name Market Share

Units Sold to

Seg Revision Date

Stock Out

Pfmn Coord

Size Coord

List Price MTBF

Age Dec.31

Promo Budget

Cust. Aware- ness

Sales Budget

Cust. Access-

ibility

Dec. Cust

Survey Fist 18% 540 12/22/2019 9.1 10.9 $39.50 24000 1.36 $1,000 54% $1,175 49% 29 Cid 18% 520 1/5/2020 8.0 12.0 $39.50 23000 2.70 $1,500 68% $1,500 54% 8 Adam 15% 452 4/19/2017 8.0 12.0 $36.00 23000 2.70 $800 48% $800 40% 8 Dixie 14% 425 5/15/2020 8.0 12.0 $38.00 23000 2.70 $800 48% $800 41% 7 Echo 13% 384 12/23/2019 7.0 12.9 $39.50 17000 1.36 $900 51% $725 38% 2 Bid 10% 300 12/5/2019 YES 9.0 11.0 $38.50 20000 1.38 $950 52% $950 44% 17 Aft 5% 142 3/29/2019 YES 9.4 15.0 $31.00 25000 2.13 $700 42% $700 40% 3 Foam 1% 39 11/10/2019 10.6 14.8 $34.50 26000 1.81 $1,000 52% $1,175 49% 1 Coat 1% 35 12/11/2019 10.9 14.9 $34.50 25000 1.77 $1,300 61% $1,300 54% 0 Dot 1% 29 9/19/2019 10.6 15.3 $30.00 26000 1.89 $700 42% $700 41% 0 Edge 1% 24 6/29/2016 YES 9.4 15.5 $34.50 25000 3.50 $300 33% $145 38% 0 Fast 1% 22 3/3/2019 5.6 14.5 $29.50 17500 2.46 $1,100 61% $1,175 49% 0

CAPSTONE ® COURIER Page 7

Performance Segment Analysis C97341 Round: 1Dec. 31, 2019

Performance Statistics Total Industry Unit Demand 2,294 Actual Industry Unit Sales |2,294 Segment % of Total Industry |8.9%

Next Year's Segment Growth Rate |19.8%

Performance Customer Buying Criteria Expectations Importance

1. Reliability MTBF 22000-27000 43% 2. Ideal Position Pfmn 10.4 Size 15.3 29% 3. Price $24.50 - 34.50 19% 4. Age Ideal Age = 1.0 9%

Top Products in Performance Segment

Name Market Share

Units Sold to

Seg Revision Date

Stock Out

Pfmn Coord

Size Coord

List Price MTBF

Age Dec.31

Promo Budget

Cust. Aware- ness

Sales Budget

Cust. Access-

ibility

Dec. Cust

Survey Dot 22% 515 9/19/2019 10.6 15.3 $30.00 26000 1.89 $700 42% $700 29% 29 Coat 19% 434 12/11/2019 10.9 14.9 $34.50 25000 1.77 $1,300 61% $1,300 38% 22 Foam 19% 428 11/10/2019 10.6 14.8 $34.50 26000 1.81 $1,000 52% $1,175 35% 26 Aft 17% 393 3/29/2019 YES 9.4 15.0 $31.00 25000 2.13 $700 42% $700 29% 19 Edge 13% 301 6/29/2016 YES 9.4 15.5 $34.50 25000 3.50 $300 33% $145 25% 12 Bold 9% 216 4/24/2019 YES 9.6 15.9 $33.50 27000 2.09 $850 47% $850 31% 28 Daze 0% 3 3/19/2019 5.8 14.5 $28.00 17500 2.44 $1,000 58% $1,000 29% 0 Fast 0% 2 3/3/2019 5.6 14.5 $29.50 17500 2.46 $1,100 61% $1,175 35% 0 Able 0% 1 11/21/2015 5.5 14.5 $26.00 17500 4.10 $1,000 58% $1,000 29% 0 Cake 0% 1 9/1/2019 6.2 13.8 $27.50 15000 2.21 $2,000 82% $2,000 38% 0

CAPSTONE ® COURIER Page 8

Size Segment Analysis C97341 Round: 1Dec. 31, 2019

Size Statistics Total Industry Unit Demand 2,347 Actual Industry Unit Sales |2,347 Segment % of Total Industry |9.1%

Next Year's Segment Growth Rate |18.3%

Size Customer Buying Criteria Expectations Importance

1. Ideal Position Pfmn 4.7 Size 9.6 43% 2. Age Ideal Age = 1.5 29% 3. Reliability MTBF 16000-21000 19% 4. Price $24.50 - 34.50 9%

Top Products in Size Segment

Name Market Share

Units Sold to

Seg Revision Date

Stock Out

Pfmn Coord

Size Coord

List Price MTBF

Age Dec.31

Promo Budget

Cust. Aware- ness

Sales Budget

Cust. Access-

ibility

Dec. Cust

Survey Dune 22% 522 10/25/2019 4.5 9.7 $30.00 19500 1.89 $700 42% $700 34% 36 Cure 18% 424 12/25/2019 4.5 9.4 $34.50 19000 1.80 $1,300 61% $1,300 46% 40 Fume 17% 387 12/10/2019 4.7 9.6 $34.50 19000 1.82 $1,000 52% $1,175 42% 37 Agape 14% 332 5/24/2016 4.0 11.0 $31.00 19000 3.60 $700 42% $700 34% 7 Egg 13% 313 12/23/2020 4.0 11.0 $34.50 19000 3.60 $900 49% $725 35% 6 Buddy 10% 236 6/5/2019 YES 4.1 10.4 $33.50 16000 2.08 $750 44% $750 35% 15 Fast 1% 30 3/3/2019 5.6 14.5 $29.50 17500 2.46 $1,100 61% $1,175 42% 0 Cake 1% 30 9/1/2019 6.2 13.8 $27.50 15000 2.21 $2,000 82% $2,000 46% 1 Eat 1% 27 3/17/2019 5.6 14.5 $27.50 16500 2.44 $1,050 60% $1,015 35% 0 Able 1% 16 11/21/2015 5.5 14.5 $26.00 17500 4.10 $1,000 58% $1,000 34% 0 Daze 1% 15 3/19/2019 5.8 14.5 $28.00 17500 2.44 $1,000 58% $1,000 34% 0 Baker 1% 14 4/24/2019 YES 5.6 14.4 $29.00 14000 2.39 $1,000 58% $1,000 35% 0

CAPSTONE ® COURIER Page 9

Market Share C97341 Round: 1Dec. 31, 2019

Actual Market Share in Units Potential Market Share in Units Trad Low High Pfmn Size Total Trad Low High Pfmn Size Total

Industry Unit Sales 8,067 10,009 2,967 2,294 2,347 25,684 Units Demanded 8,067 10,009 2,967 2,294 2,347 25,684 % of Market 31.4% 39.0% 11.6% 8.9% 9.1% 100.0% % of Market 31.4% 39.0% 11.6% 8.9% 9.1% 100.0%

Able 9.2% 0.5% 0.7% 3.2% Able 8.8% 0.4% 0.6% 3.0% Acre 1.5% 17.0% 7.1% Acre 1.5% 17.9% 7.5% Adam 15.2% 1.8% Adam 14.3% 1.7% Aft 0.2% 4.8% 17.1% 2.1% Aft 0.3% 4.9% 16.6% 2.1% Agape 0.2% 14.2% 1.3% Agape 0.2% 12.8% 1.2% Total 11.1% 17.4% 20.1% 17.2% 14.8% 15.5% Total 10.8% 18.3% 19.4% 16.7% 13.4% 15.5%

Baker 10.2% 0.1% 0.6% 3.3% Baker 14.2% 0.8% 4.6% Bead 2.3% 7.9% 3.8% Bead 2.3% 9.2% 4.3% Bid 10.1% 1.2% Bid 15.2% 1.8% Bold 0.4% 9.4% 0.9% Bold 0.4% 22.1% 2.0% Buddy 10.1% 0.9% Buddy 18.6% 1.7% Total 12.4% 7.9% 10.6% 9.4% 10.6% 10.0% Total 16.6% 9.2% 15.7% 22.1% 19.3% 14.3%

Cake 15.9% 0.3% 1.3% 5.2% Cake 15.1% 0.2% 1.1% 4.9% Cedar 1.2% 22.3% 9.1% Cedar 1.3% 24.9% 10.1% Cid 17.5% 2.0% Cid 16.5% 1.9% Coat 1.2% 18.9% 1.8% Coat 1.1% 15.8% 1.5% Cure 18.1% 1.7% Cure 16.4% 1.5% Total 17.2% 22.4% 19.0% 19.0% 19.4% 19.8% Total 16.4% 24.9% 17.8% 15.9% 17.5% 20.0%

Daze 18.8% 0.6% 0.1% 0.6% 6.1% Daze 17.8% 0.6% 0.6% 5.7% Dell 0.7% 10.1% 4.1% Dell 0.7% 9.0% 3.7% Dixie 14.3% 1.7% Dixie 13.5% 1.6% Dot 1.0% 22.5% 2.1% Dot 0.9% 18.6% 1.8% Dune 0.1% 22.3% 2.1% Dune 19.9% 1.9% Total 19.7% 10.1% 16.0% 22.6% 22.9% 16.1% Total 18.6% 9.0% 15.0% 18.7% 20.5% 14.6%

Eat 19.1% 0.1% 0.3% 1.1% 6.2% Eat 18.1% 0.3% 1.0% 5.8% Ebb 1.2% 24.6% 10.0% Ebb 1.2% 22.6% 9.2% Echo 12.9% 1.5% Echo 12.2% 1.4% Edge 0.8% 13.1% 1.3% Edge 0.8% 11.0% 1.1% Egg 13.4% 1.2% Egg 12.0% 1.1% Total 20.3% 24.7% 14.1% 13.1% 14.5% 20.2% Total 19.3% 22.7% 13.3% 11.0% 13.1% 18.6%

Fast 18.4% 0.7% 1.3% 6.0% Fast 17.4% 0.7% 1.2% 5.7% Feat 0.9% 17.4% 7.1% Feat 0.9% 15.9% 6.5% Fist 18.2% 2.1% Fist 16.8% 1.9% Foam 1.3% 18.7% 1.8% Foam 1.2% 15.6% 1.5% Fume 16.5% 1.5% Fume 15.0% 1.4% Total 19.3% 17.4% 20.3% 18.7% 17.8% 18.5% Total 18.3% 15.9% 18.8% 15.6% 16.2% 17.0%

CAPSTONE ® COURIER Page 10

Perceptual Map C97341 Round: 1Dec. 31, 2019

Andrews Baldwin Chester Name Pfmn Size Revised Name Pfmn Size Revised Name Pfmn Size Revised Able 5.5 14.5 11/21/2015 Baker 5.6 14.4 4/24/2019 Cake 6.2 13.8 9/1/2019 Acre 2.5 15.5 12/20/2019 Bead 3.0 16.5 6/7/2019 Cedar 3.0 17.0 1/15/2019 Adam 8.0 12.0 4/19/2017 Bid 9.0 11.0 12/5/2019 Cid 8.0 12.0 1/5/2020 Aft 9.4 15.0 3/29/2019 Bold 9.6 15.9 4/24/2019 Coat 10.9 14.9 12/11/2019 Agape 4.0 11.0 5/24/2016 Buddy 4.1 10.4 6/5/2019 Cure 4.5 9.4 12/25/2019

Digby Erie Ferris Name Pfmn Size Revised Name Pfmn Size Revised Name Pfmn Size Revised Daze 5.8 14.5 3/19/2019 Eat 5.6 14.5 3/17/2019 Fast 5.6 14.5 3/3/2019 Dell 2.3 18.0 10/11/2019 Ebb 3.0 17.0 1/15/2019 Feat 3.0 17.0 1/15/2019 Dixie 8.0 12.0 5/15/2020 Echo 7.0 12.9 12/23/2019 Fist 9.1 10.9 12/22/2019 Dot 10.6 15.3 9/19/2019 Edge 9.4 15.5 6/29/2016 Foam 10.6 14.8 11/10/2019 Dune 4.5 9.7 10/25/2019 Egg 4.0 11.0 12/23/2020 Fume 4.7 9.6 12/10/2019

CAPSTONE ® COURIER Page 11

HR/TQM Report C97341 Round: 1Dec. 31, 2019

HUMAN RESOURCES SUMMARY Andrews Baldwin Chester Digby Erie Ferris

Needed Complement 696 363 925 999 804 745 Complement 696 363 925 999 804 745 1st Shift Complement 635 363 793 909 630 587 2nd Shift Complement 61 0 132 90 174 158

Overtime Percent 0.0% 0.1% 0.0% 0.0% 0.0% 0.0% Turnover Rate 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% New Employees 70 36 318 399 184 120 Separated Employees 4 337 0 0 0 0 Recruiting Spend $0 $0 $0 $0 $0 $0 Training Hours 0 0 0 0 0 0 Productivity Index 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Recruiting Cost $70 $36 $318 $399 $184 $120 Separation Cost $20 $1,685 $0 $0 $0 $0 Training Cost $0 $0 $0 $0 $0 $0 Total HR Admin Cost $90 $1,721 $318 $399 $184 $120

Labor Contract Next Year Wages $22.05 $22.05 $22.05 $22.05 $22.05 $22.05 Benefits 2,500 2,500 2,500 2,500 2,500 2,500 Profit Sharing 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% Annual Raise 5.0% 5.0% 5.0% 5.0% 5.0% 5.0%

Starting Negotiation Position Wages Benefits Profit Sharing Annual Raise

Ceiling Negotiation Position Wages Benefits Profit Sharing Annual Raise

Adjusted Labor Demands Wages Benefits Profit Sharing Annual Raise

Strike Days

TQM SUMMARY Andrews Baldwin Chester Digby Erie Ferris

Process Mgt Budgets Last Year CPI Systems $0 $0 $0 $0 $0 $0 VendorJIT $0 $0 $0 $0 $0 $0 Quality Initiative Training $0 $0 $0 $0 $0 $0 Channel Support Systems $0 $0 $0 $0 $0 $0 Concurrent Engineering $0 $0 $0 $0 $0 $0 UNEP Green Programs $0 $0 $0 $0 $0 $0

TQM Budgets Last Year Benchmarking $0 $0 $0 $0 $0 $0 Quality Function Deployment Effort $0 $0 $0 $0 $0 $0 CCE/6 Sigma Training $0 $0 $0 $0 $0 $0 GEMI TQEM Sustainability Initiatives $0 $0 $0 $0 $0 $0 Total Expenditures $0 $0 $0 $0 $0 $0

Cumulative Impacts Material Cost Reduction 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Labor Cost Reduction 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Reduction R&D Cycle Time 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Reduction Admin Costs 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Demand Increase 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

CAPSTONE ® COURIER Page 12

Ethics Report C97341 Round: 1Dec. 31, 2019

ETHICS SUMMARY Other (Fees, Writeoffs, etc.) The actual dollar impact. Example, $120 means Other increased by $120. Demand Factor The % of normal. 98% means demand fell 2%. Material Cost Impact The % of normal. 104% means matieral costs rose 4%. Admin Cost Impact The % of normal. 103% means admin costs rose 3%. Productivity Impact The % of normal. 104% means productivity increased by 4%. Awareness Impact The % of normal. 105% means normal awareness was multiplied by 1.05. Accessibility Impact The % of normal. 98% means normal accessiblity was multiplied by 0.98.

Normal means the value that would have been produced if the problem had not been presented.

No Impact Andrews Baldwin Chester Digby Erie Ferris Total Other (Fees, Writeoffs, etc.) $0 $0 $0 $0 $0 $0 $0 Demand Factor 100% 100% 100% 100% 100% 100% 100% Material Cost Impact 100% 100% 100% 100% 100% 100% 100% Admin Cost Impact 100% 100% 100% 100% 100% 100% 100% Productivity Impact 100% 100% 100% 100% 100% 100% 100% Awareness Impact 100% 100% 100% 100% 100% 100% 100% Accessibility Impact 100% 100% 100% 100% 100% 100% 100%

CAPSTONE ® COURIER Page 13

Annual Report Annual Report Andrews C97341 Round: 1Dec. 31, 2019

Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The companys long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends.

ASSETS 2019 Common

Size

2018

Cash $0 0.0% $3,434 Account Receivable $8,502 9.6% $8,307 Inventory $11,543 13.1% $8,617 Total Current Assets $20,045 22.7% $20,358

Plant & Equipment $113,800 129.0% $113,800 Accumulated Depreciation ($45,520) -51.5% ($37,933) Total Fixed Assets $68,280 77.3% $75,867 Total Assets $88,325 100.0% $96,225 LIABILITIES & OWNERS EQUITY

Accounts Payable $6,366 7.2% $6,583 Current Debt $860 1.0% $0 Long Term Debt $29,846 33.8% $41,700 Total Liabilities $37,072 42.0% $48,283

Common Stock $18,360 20.8% $18,360 Retained Earnings $32,893 37.2% $29,582 Total Equity $51,253 58.0% $47,942 Total Liab. & O. Equity $88,325 100.0% $96,225

Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat.

Cash Flows from Operating Activities 2019 2018 Net Income(Loss) $3,311 $4,189 Depreciation $7,587 $7,587 Extraordinary gains/losses/writeoffs $146 $0 Accounts Payable ($217) $3,583 Inventory ($2,925) ($8,617) Accounts Receivable ($195) ($307) Net cash from operation $7,707 $6,434 Cash Flows from Investing Activities Plant Improvements $0 $0 Cash Flows from Financing Activities Dividends paid $0 ($4,000) Sales of common stock $0 $0 Purchase of common stock $0 $0 Cash from long term debt $0 $0 Retirement of long term debt ($12,000) $0 Change in current debt(net) $860 $0 Net cash from financing activities ($11,140) ($4,000) Net change in cash position ($3,434) $2,434 Closing cash position $0 $3,434

Annual Report Page 14

Annual Report Andrews C97341 Round: 1Dec. 31, 2019 2019 Income Statement

(Product Name) Able Acre Adam Aft Agape 2019 Total

Common Size

Sales $21,039 $38,197 $16,286 $17,139 $10,781 $0 $0 $0 $103,442 100.0% Variable Costs: Direct Labor $6,311 $13,562 $4,044 $4,930 $3,101 $0 $0 $0 $31,947 30.9% Direct Material $9,010 $13,533 $6,938 $8,542 $4,559 $0 $0 $0 $42,581 41.2% Inventory Carry $1,065 $39 $40 $0 $240 $0 $0 $0 $1,385 1.3% Total Variable $16,387 $27,135 $11,021 $13,471 $7,899 $0 $0 $0 $75,913 73.4%

Contribution Margin $4,652 $11,062 $5,265 $3,668 $2,881 $0 $0 $0 $27,529 26.6%

Period Costs: Depreciation $2,640 $2,427 $1,080 $720 $720 $0 $0 $0 $7,587 7.3% SG&A: R&D $0 $982 $0 $244 $0 $0 $0 $0 $1,226 1.2% Promotions $1,000 $900 $800 $700 $700 $0 $0 $0 $4,100 4.0% Sales $1,000 $900 $800 $700 $700 $0 $0 $0 $4,100 4.0% Admin $165 $300 $128 $135 $85 $0 $0 $0 $814 0.8% Total Period $4,805 $5,509 $2,808 $2,499 $2,205 $0 $0 $0 $17,826 17.2%

Net Margin ($153) $5,554 $2,457 $1,168 $677 $0 $0 $0 $9,702 9.4%

Definitions: Sales: Unit Sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost unsold goods in inventory. Depreciation: Calculated on straight-line. 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Chargs not included in other categories such as Fees, Write offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last years current debt, including short term debt, long term notes that have become due, and emergency loans, Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing.

Other $326 0.3% EBIT $9,377 9.1% Short Term Interest $135 0.1% Long Term Interest $4,043 3.9% Taxes $1,819 1.8% Profit Sharing $68 0.1% Net Profit $3,311 3.2%

Annual Report Page 15

Annual Report Annual Report Baldwin C97341 Round: 1Dec. 31, 2019

Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The companys long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends.

ASSETS 2019 Common

Size

2018

Cash $39,609 43.7% $3,434 Account Receivable $6,027 6.6% $8,307 Inventory $551 0.6% $8,617 Total Current Assets $46,187 50.9% $20,358

Plant & Equipment $68,400 75.4% $113,800 Accumulated Depreciation ($23,893) -26.3% ($37,933) Total Fixed Assets $44,507 49.1% $75,867 Total Assets $90,693 100.0% $96,225 LIABILITIES & OWNERS EQUITY

Accounts Payable $2,133 2.4% $6,583 Current Debt $0 0.0% $0 Long Term Debt $41,680 46.0% $41,700 Total Liabilities $43,813 48.3% $48,283

Common Stock $18,360 20.2% $18,360 Retained Earnings $28,521 31.4% $29,582 Total Equity $46,881 51.7% $47,942 Total Liab. & O. Equity $90,693 100.0% $96,225

Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat.

Cash Flows from Operating Activities 2019 2018 Net Income(Loss) $939 $4,189 Depreciation $4,560 $7,587 Extraordinary gains/losses/writeoffs $930 $0 Accounts Payable ($4,450) $3,583 Inventory $8,067 ($8,617) Accounts Receivable $2,281 ($307) Net cash from operation $12,326 $6,434 Cash Flows from Investing Activities Plant Improvements $25,870 $0 Cash Flows from Financing Activities Dividends paid ($2,000) ($4,000) Sales of common stock $0 $0 Purchase of common stock $0 $0 Cash from long term debt $0 $0 Retirement of long term debt ($20) $0 Change in current debt(net) $0 $0 Net cash from financing activities ($2,020) ($4,000) Net change in cash position $36,176 $2,434 Closing cash position $39,609 $3,434

Annual Report Page 16

Annual Report Baldwin C97341 Round: 1Dec. 31, 2019 2019 Income Statement

(Product Name) Baker Bead Bid Bold Buddy 2019 Total

Common Size

Sales $24,274 $21,968 $11,534 $7,610 $7,937 $0 $0 $0 $73,323 100.0% Variable Costs: Direct Labor $6,468 $6,540 $2,655 $1,997 $2,089 $0 $0 $0 $19,750 26.9% Direct Material $8,925 $7,019 $4,614 $3,602 $3,088 $0 $0 $0 $27,247 37.2% Inventory Carry $0 $66 $0 $0 $0 $0 $0 $0 $66 0.1% Total Variable $15,393 $13,625 $7,269 $5,599 $5,178 $0 $0 $0 $47,063 64.2%

Contribution Margin $8,881 $8,343 $4,265 $2,011 $2,759 $0 $0 $0 $26,259 35.8%

Period Costs: Depreciation $1,387 $2,000 $440 $440 $293 $0 $0 $0 $4,560 6.2% SG&A: R&D $317 $437 $941 $315 $433 $0 $0 $0 $2,442 3.3% Promotions $1,000 $1,100 $950 $850 $750 $0 $0 $0 $4,650 6.3% Sales $1,000 $1,000 $950 $850 $750 $0 $0 $0 $4,550 6.2% Admin $740 $670 $351 $232 $242 $0 $0 $0 $2,235 3.0% Total Period $4,443 $5,207 $3,632 $2,687 $2,468 $0 $0 $0 $18,437 25.1%

Net Margin $4,438 $3,136 $633 ($676) $291 $0 $0 $0 $7,822 10.7%

Definitions: Sales: Unit Sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost unsold goods in inventory. Depreciation: Calculated on straight-line. 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Chargs not included in other categories such as Fees, Write offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last years current debt, including short term debt, long term notes that have become due, and emergency loans, Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing.

Other $930 1.3% EBIT $6,892 9.4% Short Term Interest $0 0.0% Long Term Interest $5,419 7.4% Taxes $516 0.7% Profit Sharing $19 0.0% Net Profit $939 1.3%

Annual Report Page 17

Annual Report Annual Report Chester C97341 Round: 1Dec. 31, 2019

Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The companys long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends.

ASSETS 2019 Common

Size

2018

Cash $6,262 5.1% $3,434 Account Receivable $11,251 9.1% $8,307 Inventory $18,262 14.8% $8,617 Total Current Assets $35,775 29.1% $20,358

Plant & Equipment $134,200 109.0% $113,800 Accumulated Depreciation ($46,880) -38.1% ($37,933) Total Fixed Assets $87,320 70.9% $75,867 Total Assets $123,095 100.0% $96,225 LIABILITIES & OWNERS EQUITY

Accounts Payable $8,482 6.9% $6,583 Current Debt $4,500 3.7% $0 Long Term Debt $58,700 47.7% $41,700 Total Liabilities $71,682 58.2% $48,283

Common Stock $20,360 16.5% $18,360 Retained Earnings $31,053 25.2% $29,582 Total Equity $51,413 41.8% $47,942 Total Liab. & O. Equity $123,095 100.0% $96,225

Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat.

Cash Flows from Operating Activities 2019 2018 Net Income(Loss) $1,471 $4,189 Depreciation $8,947 $7,587 Extraordinary gains/losses/writeoffs $0 $0 Accounts Payable $1,899 $3,583 Inventory ($9,645) ($8,617) Accounts Receivable ($2,943) ($307) Net cash from operation ($272) $6,434 Cash Flows from Investing Activities Plant Improvements ($20,400) $0 Cash Flows from Financing Activities Dividends paid $0 ($4,000) Sales of common stock $2,000 $0 Purchase of common stock $0 $0 Cash from long term debt $17,000 $0 Retirement of long term debt $0 $0 Change in current debt(net) $4,500 $0 Net cash from financing activities $23,500 ($4,000) Net change in cash position $2,828 $2,434 Closing cash position $6,262 $3,434

Annual Report Page 18

Annual Report Chester C97341 Round: 1Dec. 31, 2019 2019 Income Statement

(Product Name) Cake Cedar Cid Coat Cure 2019 Total

Common Size

Sales $36,646 $48,891 $20,534 $16,160 $14,652 $0 $0 $0 $136,883 100.0% Variable Costs: Direct Labor $10,412 $18,551 $4,650 $4,178 $3,789 $0 $0 $0 $41,580 30.4% Direct Material $14,764 $16,444 $7,959 $7,213 $5,594 $0 $0 $0 $51,975 38.0% Inventory Carry $1,192 $0 $296 $446 $258 $0 $0 $0 $2,191 1.6% Total Variable $26,368 $34,995 $12,905 $11,837 $9,641 $0 $0 $0 $95,746 69.9%

Contribution Margin $10,278 $13,896 $7,629 $4,323 $5,011 $0 $0 $0 $41,137 30.1%

Period Costs: Depreciation $2,880 $3,547 $1,080 $720 $720 $0 $0 $0 $8,947 6.5% SG&A: R&D $675 $40 $1,000 $956 $996 $0 $0 $0 $3,668 2.7% Promotions $2,000 $2,000 $1,500 $1,300 $1,300 $0 $0 $0 $8,100 5.9% Sales $2,000 $2,000 $1,500 $1,300 $1,300 $0 $0 $0 $8,100 5.9% Admin $342 $456 $191 $151 $137 $0 $0 $0 $1,276 0.9% Total Period $7,897 $8,042 $5,271 $4,427 $4,453 $0 $0 $0 $30,090 22.0%

Net Margin $2,381 $5,854 $2,358 ($104) $558 $0 $0 $0 $11,047 8.1%

Definitions: Sales: Unit Sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost unsold goods in inventory. Depreciation: Calculated on straight-line. 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Chargs not included in other categories such as Fees, Write offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last years current debt, including short term debt, long term notes that have become due, and emergency loans, Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing.

Other $950 0.7% EBIT $10,097 7.4% Short Term Interest $446 0.3% Long Term Interest $7,342 5.4% Taxes $808 0.6% Profit Sharing $30 0.0% Net Profit $1,471 1.1%

Annual Report Page 19

Annual Report Annual Report Digby C97341 Round: 1Dec. 31, 2019

Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The companys long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends.

ASSETS 2019 Common

Size

2018

Cash $0 0.0% $3,434 Account Receivable $9,668 6.9% $8,307 Inventory $41,739 29.7% $8,617 Total Current Assets $51,407 36.5% $20,358

Plant & Equipment $136,350 96.9% $113,800 Accumulated Depreciation ($47,023) -33.4% ($37,933) Total Fixed Assets $89,327 63.5% $75,867 Total Assets $140,734 100.0% $96,225 LIABILITIES & OWNERS EQUITY

Accounts Payable $9,397 6.7% $6,583 Current Debt $43,581 31.0% $0 Long Term Debt $41,700 29.6% $41,700 Total Liabilities $94,678 67.3% $48,283

Common Stock $18,360 13.0% $18,360 Retained Earnings $27,696 19.7% $29,582 Total Equity $46,056 32.7% $47,942 Total Liab. & O. Equity $140,734 100.0% $96,225

Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat.

Cash Flows from Operating Activities 2019 2018 Net Income(Loss) ($1,886) $4,189 Depreciation $9,090 $7,587 Extraordinary gains/losses/writeoffs $0 $0 Accounts Payable $2,814 $3,583 Inventory ($33,122) ($8,617) Accounts Receivable ($1,361) ($307) Net cash from operation ($24,464) $6,434 Cash Flows from Investing Activities Plant Improvements ($22,550) $0 Cash Flows from Financing Activities Dividends paid $0 ($4,000) Sales of common stock $0 $0 Purchase of common stock $0 $0 Cash from long term debt $0 $0 Retirement of long term debt $0 $0 Change in current debt(net) $43,581 $0 Net cash from financing activities $43,581 ($4,000) Net change in cash position ($3,434) $2,434 Closing cash position $0 $3,434

Annual Report Page 20

Annual Report Digby C97341 Round: 1Dec. 31, 2019 2019 Income Statement

(Product Name) Daze Dell Dixie Dot Dune 2019 Total

Common Size

Sales $43,571 $25,536 $16,165 $16,330 $16,025 $0 $0 $0 $117,627 100.0% Variable Costs: Direct Labor $12,443 $7,583 $3,984 $5,019 $5,019 $0 $0 $0 $34,048 28.9% Direct Material $17,426 $7,611 $6,500 $8,512 $7,111 $0 $0 $0 $47,160 40.1% Inventory Carry $1,184 $958 $1,789 $528 $549 $0 $0 $0 $5,009 4.3% Total Variable $31,053 $16,153 $12,273 $14,059 $12,678 $0 $0 $0 $86,216 73.3%

Contribution Margin $12,518 $9,383 $3,892 $2,271 $3,347 $0 $0 $0 $31,411 26.7%

Period Costs: Depreciation $3,151 $2,828 $1,333 $889 $889 $0 $0 $0 $9,090 7.7% SG&A: R&D $216 $788 $1,000 $728 $826 $0 $0 $0 $3,559 3.0% Promotions $1,000 $900 $800 $700 $700 $0 $0 $0 $4,100 3.5% Sales $1,000 $900 $800 $700 $700 $0 $0 $0 $4,100 3.5% Admin $453 $265 $168 $170 $167 $0 $0 $0 $1,222 1.0% Total Period $5,820 $5,682 $4,101 $3,186 $3,282 $0 $0 $0 $22,071 18.8%

Net Margin $6,697 $3,701 ($209) ($915) $65 $0 $0 $0 $9,340 7.9%

Definitions: Sales: Unit Sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost unsold goods in inventory. Depreciation: Calculated on straight-line. 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Chargs not included in other categories such as Fees, Write offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last years current debt, including short term debt, long term notes that have become due, and emergency loans, Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing.

Other $0 0.0% EBIT $9,340 7.9% Short Term Interest $6,821 5.8% Long Term Interest $5,421 4.6% Taxes ($1,015) -0.9% Profit Sharing $0 0.0% Net Profit ($1,886) -1.6%

Annual Report Page 21

Annual Report Annual Report Erie C97341 Round: 1Dec. 31, 2019

Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The companys long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends.

ASSETS 2019 Common

Size

2018

Cash $25,930 22.0% $3,434 Account Receivable $10,862 9.2% $8,307 Inventory $4,154 3.5% $8,617 Total Current Assets $40,946 34.8% $20,358

Plant & Equipment $119,800 102.0% $113,800 Accumulated Depreciation ($42,987) -36.5% ($37,933) Total Fixed Assets $76,813 65.2% $75,867 Total Assets $117,759 100.0% $96,225 LIABILITIES & OWNERS EQUITY

Accounts Payable $7,274 6.2% $6,583 Current Debt $11,359 9.6% $0 Long Term Debt $38,560 32.7% $41,700 Total Liabilities $57,193 48.6% $48,283

Common Stock $22,747 19.3% $18,360 Retained Earnings $37,820 32.1% $29,582 Total Equity $60,567 51.4% $47,942 Total Liab. & O. Equity $117,759 100.0% $96,225

Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat.

Cash Flows from Operating Activities 2019 2018 Net Income(Loss) $8,237 $4,189 Depreciation $7,987 $7,587 Extraordinary gains/losses/writeoffs $131 $0 Accounts Payable $691 $3,583 Inventory $4,464 ($8,617) Accounts Receivable ($2,554) ($307) Net cash from operation $18,955 $6,434 Cash Flows from Investing Activities Plant Improvements ($9,080) $0 Cash Flows from Financing Activities Dividends paid $0 ($4,000) Sales of common stock $4,387 $0 Purchase of common stock $0 $0 Cash from long term debt $0 $0 Retirement of long term debt ($3,124) $0 Change in current debt(net) $11,359 $0 Net cash from financing activities $12,622 ($4,000) Net change in cash position $22,497 $2,434 Closing cash position $25,930 $3,434

Annual Report Page 22

Annual Report Erie C97341 Round: 1Dec. 31, 2019 2019 Income Statement

(Product Name) Eat Ebb Echo Edge Egg 2019 Total

Common Size

Sales $43,670 $51,276 $15,157 $11,217 $10,829 $0 $0 $0 $132,149 100.0% Variable Costs: Direct Labor $12,577 $20,884 $3,429 $2,885 $2,793 $0 $0 $0 $42,567 32.2% Direct Material $17,343 $18,104 $5,802 $5,020 $4,125 $0 $0 $0 $50,394 38.1% Inventory Carry $83 $0 $295 $0 $121 $0 $0 $0 $498 0.4% Total Variable $30,003 $38,988 $9,525 $7,905 $7,039 $0 $0 $0 $93,460 70.7%

Contribution Margin $13,668 $12,288 $5,631 $3,312 $3,790 $0 $0 $0 $38,689 29.3%

Period Costs: Depreciation $2,427 $2,800 $1,320 $720 $720 $0 $0 $0 $7,987 6.0% SG&A: R&D $210 $40 $989 $0 $1,000 $0 $0 $0 $2,240 1.7% Promotions $1,050 $1,050 $900 $300 $900 $0 $0 $0 $4,200 3.2% Sales $1,015 $1,015 $725 $145 $725 $0 $0 $0 $3,625 2.7% Admin $367 $430 $127 $94 $91 $0 $0 $0 $1,109 0.8% Total Period $5,068 $5,335 $4,062 $1,259 $3,436 $0 $0 $0 $19,161 14.5%

Net Margin $8,599 $6,952 $1,570 $2,053 $354 $0 $0 $0 $19,529 14.8%

Definitions: Sales: Unit Sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost unsold goods in inventory. Depreciation: Calculated on straight-line. 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Chargs not included in other categories such as Fees, Write offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last years current debt, including short term debt, long term notes that have become due, and emergency loans, Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing.

Other $397 0.3% EBIT $19,132 14.5% Short Term Interest $1,125 0.9% Long Term Interest $5,076 3.8% Taxes $4,526 3.4% Profit Sharing $168 0.1% Net Profit $8,237 6.2%

Annual Report Page 23

Annual Report Annual Report Ferris C97341 Round: 1Dec. 31, 2019

Balance Sheet DEFINITIONS: Common Size: The common size column simply represents each item as a percentage of total assets for that year. Cash: Your end-of-year cash position. Accounts Receivable: Reflects the lag between delivery and payment of your products. Inventories: The current value of your inventory across all products. A zero indicates your company stocked out. Unmet demand would, of course, fall to your competitors. Plant & Equipment: The current value of your plant. Accum Deprec: The total accumulated depreciation from your plant. Accts Payable: What the company currently owes suppliers for materials and services. Current Debt: The debt the company is obligated to pay during the next year of operations. It includes emergency loans used to keep your company solvent should you run out of cash during the year. Long Term Debt: The companys long term debt is in the form of bonds, and this represents the total value of your bonds. Common Stock: The amount of capital invested by shareholders in the company. Retained Earnings: The profits that the company chose to keep instead of paying to shareholders as dividends.

ASSETS 2019 Common

Size

2018

Cash $28,373 29.5% $3,434 Account Receivable $11,198 11.6% $8,307 Inventory $2,474 2.6% $8,617 Total Current Assets $42,045 43.6% $20,358

Plant & Equipment $87,800 91.2% $113,800 Accumulated Depreciation ($33,520) -34.8% ($37,933) Total Fixed Assets $54,280 56.4% $75,867 Total Assets $96,324 100.0% $96,225 LIABILITIES & OWNERS EQUITY

Accounts Payable $6,962 7.2% $6,583 Current Debt $11,359 11.8% $0 Long Term Debt $26,750 27.8% $41,700 Total Liabilities $45,071 46.8% $48,283

Common Stock $18,360 19.1% $18,360 Retained Earnings $32,894 34.1% $29,582 Total Equity $51,254 53.2% $47,942 Total Liab. & O. Equity $96,324 100.0% $96,225

Cash Flow Statement The Cash Flow Statement examines what happened in the Cash Account during the year. Cash injections appear as positive numbers and cash withdrawals as negative numbers. The Cash Flow Statement is an excellent tool for diagnosing emergency loans. When negative cash flows exceed positives, you are forced to seek emergency funding. For example, if sales are bad and you find yourself carrying an abundance of excess inventory, the report would show the increase in inventory as a huge negative cash flow. Too much unexpected inventory could outstrip your inflows, exhaust your starting cash and force you to beg for money to keep your company afloat.

Cash Flows from Operating Activities 2019 2018 Net Income(Loss) $11,011 $4,189 Depreciation $5,853 $7,587 Extraordinary gains/losses/writeoffs $774 $0 Accounts Payable $379 $3,583 Inventory $6,144 ($8,617) Accounts Receivable ($2,891) ($307) Net cash from operation $21,270 $6,434 Cash Flows from Investing Activities Plant Improvements $15,220 $0 Cash Flows from Financing Activities Dividends paid ($7,699) ($4,000) Sales of common stock $0 $0 Purchase of common stock $0 $0 Cash from long term debt $0 $0 Retirement of long term debt ($15,211) $0 Change in current debt(net) $11,359 $0 Net cash from financing activities ($11,551) ($4,000) Net change in cash position $24,939 $2,434 Closing cash position $28,373 $3,434

Annual Report Page 24

Annual Report Ferris C97341 Round: 1Dec. 31, 2019 2019 Income Statement

(Product Name) Fast Feat Fist Foam Fume Fox 2019 Total

Common Size

Sales $45,355 $40,066 $21,324 $16,113 $13,383 $0 $0 $0 $136,241 100.0% Variable Costs: Direct Labor $12,718 $14,786 $5,021 $4,158 $3,455 $0 $0 $0 $40,138 29.5% Direct Material $17,136 $12,873 $8,327 $7,257 $5,120 $0 $0 $0 $50,713 37.2% Inventory Carry $88 $0 $134 $19 $56 $0 $0 $0 $297 0.2% Total Variable $29,942 $27,658 $13,482 $11,434 $8,631 $0 $0 $0 $91,148 66.9%

Contribution Margin $15,413 $12,408 $7,843 $4,678 $4,752 $0 $0 $0 $45,094 33.1%

Period Costs: Depreciation $1,760 $1,733 $600 $880 $880 $0 $0 $0 $5,853 4.3% SG&A: R&D $171 $40 $988 $871 $954 $1,000 $0 $0 $4,023 3.0% Promotions $1,100 $1,100 $1,000 $1,000 $1,000 $0 $0 $0 $5,200 3.8% Sales $1,175 $1,175 $1,175 $1,175 $1,175 $0 $0 $0 $5,875 4.3% Admin $357 $316 $168 $127 $105 $0 $0 $0 $1,073 0.8% Total Period $4,563 $4,364 $3,930 $4,053 $4,115 $1,000 $0 $0 $22,025 16.2%

Net Margin $10,850 $8,044 $3,912 $625 $637 ($1,000) $0 $0 $23,069 16.9%

Definitions: Sales: Unit Sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost: the cost unsold goods in inventory. Depreciation: Calculated on straight-line. 15-year depreciation of plant value. R&D Costs: R&D department expenditures for each product. Admin: Administration overhead is estimated at 1.5% of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for each product. Other: Chargs not included in other categories such as Fees, Write offs, and TQM. The fees include money paid to investment bankers and brokerage firms to issue new stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on the liquidation of capacity or inventory. EBIT: Earnings Before Interest and Taxes. Short Term Interest: Interest expense based on last years current debt, including short term debt, long term notes that have become due, and emergency loans, Long Term Interest: Interest paid on outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit sharing.

Other $1,002 0.7% EBIT $22,067 16.2% Short Term Interest $1,125 0.8% Long Term Interest $3,656 2.7% Taxes $6,050 4.4% Profit Sharing $225 0.2% Net Profit $11,011 8.1%

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