Finance
Bfh
CentralCircuitBreakerExhibits2.xlsxExhibit 1
| Central Circuit Breaker | |||||
| Operating History (in real terms) | |||||
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
| Sales revenue | $1,400,000 | $1,600,000 | $1,100,000 | $1,200,000 | $1,500,000 |
| Cost of goods sold | $560,000 | $620,000 | $460,000 | $500,000 | $580,000 |
| Gross profit | $840,000 | $980,000 | $640,000 | $700,000 | $920,000 |
| Operating expenses | $820,000 | $955,000 | $635,000 | $680,000 | $930,000 |
| Net income | $20,000 | $25,000 | $5,000 | $20,000 | ($10,000) |
| Tax expense | $5,000 | $6,250 | $1,250 | $5,000 | ($2,500) |
| Notational Items Included in Operating Expenses | |||||
| Owner salary and bonus | $90,000 | $100,000 | $70,000 | $70,000 | $90,000 |
| Depreciation - Owner's autos | $12,000 | $12,000 | $12,000 | $14,000 | $14,000 |
| Building rent | $50,000 | $50,000 | $45,000 | $45,000 | $55,000 |
| Life insurance | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 |
| Travel and entertainment | $12,000 | $13,000 | $2,000 | $4,000 | $7,000 |
| Discretionary Expenses | 66000 | 76000 | 41000 | 42000 | 72000 |
Exhibit 2
| Current Yield and Market Information | |||
| Short-term Treasury Notes | 5.50% | ||
| Long-term Treasury Notes | 6.25% | ||
| Investment Grade Corporate Bonds | 8.50% | ||
| Expected Annual Inflation | 4.00% | ||
| Historical Yield and Market Information | |||
| Short-term Treasury Notes | 4.00% | ||
| Long-term Treasury Notes | 4.50% | ||
| Investment Grade Corporate Bonds | 6.00% | ||
| Market Risk Premium (long-term) | 6.50% | ||
