Business Management Final

Round: 4 Dec. 31, 2017 C58538

Andrews Eugene Ellis Philip Mull

Baldwin Lisa Chastain Monica Dalke matt rix

Chester

Digby Erie Ferris

Selected Financial Statistics Andrews Baldwin Chester Digby Erie Ferris

ROS -39.0% -2.4% 9.1% 7.9% 6.2% 6.1% Asset Turnover 0.47 1.03 1.11 1.16 0.89 1.18 ROA -18.5% -2.5% 10.1% 9.2% 5.5% 7.2% Leverage (Assets/Equity)

-6.4 2.4 2.1 2.1 2.1 2.0

ROE -118.5% -6.1% 20.8% 18.9% 11.6% 14.7% Emergency Loan $144,387,047 $19,028,216 $0 $0 $0 $0 Sales $74,279,337 $108,140,184 $197,793,741 $226,989,314 $163,657,275 $200,781,475 EBIT ($13,609,560) $3,692,335 $38,518,462 $39,191,926 $27,033,430 $28,824,169 Profits ($28,964,077) ($2,628,021) $18,059,732 $17,922,007 $10,154,948 $12,303,415 Cumulative Profit ($77,143,989) ($446,004) $47,737,048 $51,599,176 $35,276,750 $45,310,045 SG&A / Sales 8.4% 8.3% 9.4% 10.3% 8.7% 10.3% Contrib. Margin % -0.2% 18.7% 34.7% 32.9% 34.0% 29.7%

CAPSTONE® COURIER Page 1

Stock & Bonds C58538 Round: 4Dec. 31, 2017

Stock Market Summary

Company Close Change Shares MarketCap

($M) Book Value EPS Dividend Yield P/E

Andrews $1.00 $0.00 2,291,939 $2 ($10.67) ($12.64) $0.00 0.0% -0.0 Baldwin $5.00 ($7.57) 2,000,000 $10 $21.65 ($1.31) $0.00 0.0% -3.8 Chester $77.59 $17.05 2,124,345 $165 $40.94 $8.50 $3.36 4.3% 9.1 Digby $83.06 $18.15 2,053,924 $171 $46.19 $8.73 $1.36 1.6% 9.5 Erie $56.79 $5.20 2,311,647 $131 $37.81 $4.39 $0.00 0.0% 12.9 Ferris $68.06 $6.77 2,107,251 $143 $39.67 $5.84 $0.00 0.0% 11.7

Bond Market Summary Company Series# Face Yield Close$ S&P Company Series# Face Yield Close$ S&P Andrews Digby

14.0S2019 $20,850,000 14.3% 97.89 DDD 14.0S2019 $20,850,000 13.9% 101.00 B Baldwin 11.6S2025 $3,523,690 12.7% 91.48 B

14.0S2019 $20,850,000 14.0% 99.67 CC 12.2S2026 $8,623,471 13.0% 93.93 B Chester 12.9S2027 $16,806,601 13.3% 97.33 B

14.0S2019 $20,850,000 13.9% 101.00 B Erie 12.1S2026 $13,308,235 13.0% 93.43 B 14.0S2019 $20,850,000 13.9% 100.83 CCC 12.9S2027 $12,249,416 13.3% 97.33 B 11.7S2025 $1,722,021 12.8% 91.51 CCC

12.3S2026 $11,199,852 13.1% 93.95 CCC 13.0S2027 $25,774,968 13.4% 97.34 CCC

Ferris 14.0S2019 $20,850,000 13.9% 101.00 B 12.2S2026 $8,738,656 13.0% 93.93 B 12.9S2027 $15,268,932 13.3% 97.33 B

Next Year's Prime Rate 9.00%

CAPSTONE® COURIER Page 2

Financial Summary C58538 Round: 4Dec. 31, 2017 Cash Flow Statement Survey Andrews Baldwin Chester Digby Erie Ferris CashFlows from operating activities Net Income(Loss) ($28,964) ($2,628) $18,060 $17,922 $10,155 $12,303 Adjustment for non-cash items: Depreciation $7,227 $7,587 $10,887 $11,393 $12,687 $9,600 Extraordinary gains/losses/writeoffs $0 $0 $0 $0 $0 ($403) Changes in current assets and liablilities Acounts payable ($171) $89 $738 $598 ($1,743) $360 Inventory $3,669 ($18,140) $4,614 $4,676 $8,155 $221 Accounts Receivable ($355) ($990) ($3,145) ($3,398) ($783) ($1,256) Net cash from operations ($18,594) ($14,083) $31,153 $31,192 $28,470 $20,825

Cash flows from investing activities Plant improvements(net) $0 $0 ($4,800) ($12,500) ($32,200) ($29,870) Cash flows from financing activities Dividends paid $0 $0 ($7,141) ($2,791) $0 $0 Sales of common stock $0 $0 $0 $0 $8,217 $5,768 Purchase of common stock $0 $0 $0 $0 $0 $0 Cash from long term debt issued $0 $0 $12,249 $16,807 $25,775 $15,269 Early retirement of long term debt $0 $0 $0 $0 $0 $0 Retirement of current debt ($125,793) ($4,945) ($22,524) ($26,194) ($16,972) ($22,433) Cash from current debt borrowing $0 $0 $21,385 $25,380 $14,055 $26,294 Cash from emergency loan $144,387 $19,028 $0 $0 $0 $0

Net cash from financing activities $18,594 $14,083 $3,969 $13,201 $31,076 $24,898

Net change in cash position $0 $0 $30,322 $31,893 $27,346 $15,853 Balance Sheet Survey Andrews Baldwin Chester Digby Erie Ferris Cash $0 $0 $53,528 $53,933 $44,158 $43,502 Accounts Receivable $6,105 $8,888 $16,257 $18,657 $13,451 $16,503 Inventory $107,012 $50,888 $12,000 $17,854 $5,291 $13,710 Total Current Assets $113,117 $59,777 $81,785 $90,444 $62,900 $73,714

Plant and equipment $108,400 $113,800 $163,300 $170,900 $190,300 $144,000 Accumulated Depreciation ($65,040) ($68,280) ($66,307) ($65,500) ($70,147) ($46,900) Total Fixed Assets $43,360 $45,520 $96,993 $105,400 $120,153 $97,100

Total Assets $156,477 $105,297 $178,778 $195,844 $183,054 $170,814

Account Payable $4,760 $8,211 $10,119 $11,951 $8,149 $11,445 CurrentDebt $155,312 $32,928 $35,285 $39,209 $27,955 $30,911 Long Term Debt $20,850 $20,850 $46,408 $49,804 $59,547 $44,858 Total Liabilities $180,922 $61,989 $91,812 $100,964 $95,651 $87,213

Common Stock $28,360 $18,360 $23,767 $20,678 $32,164 $24,861 Retained Earnings ($52,805) $24,948 $63,199 $74,202 $55,238 $58,740 Total Equity ($24,445) $43,307 $86,966 $94,880 $87,402 $83,601

Total Liabilities & Owners'' Equity $156,477 $105,297 $178,778 $195,844 $183,054 $170,814

Income Statement Survey Andrews Baldwin Chester Digby Erie Ferris Sales $74,279 $108,140 $197,794 $226,989 $163,657 $200,781 Variable Costs(Labor,Material,Carry) $74,429 $87,869 $129,174 $152,226 $107,941 $141,109 Depreciation $7,227 $7,587 $10,887 $11,393 $12,687 $9,600 SGA(R&D,Promo,Sales,Admin) $6,233 $8,992 $18,602 $23,338 $14,297 $20,600 Other(Fees,Writeoffs,TQM,Bonuses) $0 $0 $612 $840 $1,700 $648 EBIT ($13,610) $3,692 $38,518 $39,192 $27,033 $28,824 Interest(Short term,Long term) $30,951 $7,735 $10,167 $11,057 $11,092 $9,510 Taxes ($15,596) ($1,415) $9,923 $9,847 $5,580 $6,760 Profit Sharing $0 $0 $369 $366 $207 $251 Net Profit ($28,964) ($2,628) $18,060 $17,922 $10,155 $12,303

CAPSTONE® COURIER Page 3

Production Analysis C58538 Round: 4Dec. 31, 2017

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 1,085 3,357 10/4/2016 3.1 17000 6.4 13.5 $23.50 $9.02 $9.02 -14% 0% 4.0 1,800 52% Acre Low 1,355 1,416 11/5/2016 3.4 16000 3.8 17.0 $17.40 $6.24 $7.73 4% 0% 5.0 1,400 99% Adam High 206 416 11/21/2016 2.6 22000 9.6 8.9 $33.00 $13.76 $10.31 7% 0% 3.0 900 28% Aft Pfmn 347 0 10/15/2016 2.5 27000 11.4 14.6 $29.90 $14.16 $11.01 15% 17% 3.0 300 116% Agape Size 278 436 7/30/2016 3.1 19000 5.4 8.6 $29.00 $11.76 $10.31 7% 0% 3.0 600 46%

Baker Trad 1,795 645 12/23/2016 2.6 17500 6.5 12.8 $25.00 $9.51 $9.02 22% 0% 4.0 1,800 99% Bead Low 2,241 479 5/25/2009 8.6 14000 3.0 17.0 $18.50 $5.27 $9.39 17% 82% 5.0 1,400 180% Bid High 141 916 6/9/2016 3.1 22000 9.9 10.0 $36.50 $13.41 $10.31 -17% 0% 3.0 900 61% Bold Pfmn 237 27 7/16/2016 2.9 26000 11.4 15.1 $33.00 $13.76 $10.31 25% 0% 3.0 600 41% Buddy Size 268 416 5/4/2017 2.3 19000 5.4 8.6 $33.00 $11.76 $10.31 22% 0% 3.0 600 74%

Cake Trad 1,872 14 9/14/2017 1.4 14000 7.8 12.2 $26.00 $9.23 $7.65 35% 65% 6.0 1,000 163% Cedar Low 2,426 394 1/29/2014 8.6 12000 3.0 17.0 $19.00 $4.67 $4.32 49% 32% 8.0 1,850 131% Cid High 1,033 112 11/15/2017 1.1 23000 12.5 7.5 $37.00 $15.81 $11.01 28% 17% 3.0 900 116% Coat Pfmn 907 104 9/21/2017 1.4 27000 13.4 13.2 $32.00 $15.55 $8.60 23% 6% 4.5 950 105% Cure Size 1,118 119 9/21/2017 1.3 17000 6.8 6.6 $32.00 $12.55 $9.24 31% 28% 4.5 1,000 127%

Daze Trad 1,898 70 9/18/2017 1.4 18700 8.2 11.9 $28.50 $10.93 $8.48 32% 70% 5.5 1,050 168% Dell Low 1,961 361 6/19/2019 8.6 14000 3.0 17.0 $21.00 $5.27 $4.69 48% 9% 7.5 1,600 108% Dixie High 967 207 1/1/2018 2.1 24500 11.3 8.7 $38.50 $15.27 $10.78 30% 11% 3.0 950 109% Dot Pfmn 834 104 10/6/2017 1.3 27000 13.8 12.8 $33.50 $15.85 $9.02 25% 0% 4.0 1,000 94% Dune Size 1,241 159 10/6/2017 1.3 19000 7.2 6.4 $33.50 $13.35 $10.18 29% 37% 4.0 1,150 135% Doom Pfmn 746 39 8/31/2017 0.9 27000 13.7 12.9 $33.50 $15.78 $7.47 30% 50% 6.0 650 149%

Eat Low 1,226 210 1/15/2017 4.1 13500 5.5 14.5 $20.50 $7.19 $4.51 37% 0% 8.0 1,400 74% Ebb Low 2,763 252 6/18/2019 8.6 12000 3.0 17.0 $18.50 $4.67 $5.24 43% 51% 8.0 1,750 150% Echo Trad 2,174 0 9/14/2017 1.3 15000 7.8 12.2 $26.00 $9.53 $7.94 33% 95% 6.5 1,150 193% Egg Trad 1,188 0 7/21/2017 1.7 16000 7.8 12.2 $26.00 $9.83 $11.17 19% 100% 5.0 1,300 198%

Fast Low 675 85 1/29/2017 4.1 12000 5.5 14.5 $21.00 $6.74 $9.73 17% 20% 4.0 500 119% Feat Low 1,796 135 7/27/2018 8.6 13000 3.0 17.0 $21.00 $4.97 $7.70 38% 70% 6.0 1,150 168% Fist High 1,311 156 12/26/2017 1.1 25000 12.5 7.5 $38.00 $16.41 $12.12 26% 59% 3.0 850 157% Foam Pfmn 876 101 10/7/2017 1.3 27000 13.8 12.8 $33.00 $15.85 $8.61 25% 6% 5.0 850 105% Fume Size 977 168 11/23/2017 1.2 17000 6.8 6.0 $33.00 $12.87 $9.66 32% 18% 5.0 950 116% Fox High 998 0 12/22/2017 0.8 25000 13.0 7.0 $38.00 $16.82 $8.77 34% 100% 5.5 1,300 198%

CAPSTONE® COURIER Page 4

Traditional Segment Analysis C58538 Round: 4Dec. 31, 2017

Traditional Statistics Total Industry Unit Demand 10,504 Actual Industry Unit Sales 10,504 Segment % of Total Industry 28.4%

Next Year's Segment Growth Rate 9.2%

Traditional Customer Buying Criteria Expectations Importance

1. Age Ideal Age = 2.0 47% 2. Price $18.00 - 28.00 23% 3. Ideal Position Pfmn 7.8 Size 12.2 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 Echo 21% 2,173 9/14/2017 YES 7.8 12.2 $26.00 15000 1.33 $1,350 76% $1,056 77% 34 Daze 18% 1,896 9/18/2017 8.2 11.9 $28.50 18700 1.44 $1,225 77% $1,670 51% 30 Cake 18% 1,871 9/14/2017 7.8 12.2 $26.00 14000 1.45 $1,150 71% $1,675 50% 30 Baker 17% 1,765 12/23/2016 6.5 12.8 $25.00 17500 2.56 $1,000 63% $1,000 32% 24 Egg 11% 1,188 7/21/2017 YES 7.8 12.2 $26.00 16000 1.70 $1,350 76% $1,056 77% 44 Able 9% 988 10/4/2016 6.4 13.5 $23.50 17000 3.05 $500 31% $500 20% 10 Eat 4% 447 1/15/2017 5.5 14.5 $20.50 13500 4.09 $1,350 79% $1,056 77% 3 Fast 2% 176 1/29/2017 5.5 14.5 $21.00 12000 4.08 $900 57% $710 27% 1

CAPSTONE® COURIER Page 5

Low End Segment Analysis C58538 Round: 4Dec. 31, 2017

Low End Statistics Total Industry Unit Demand 13,949 Actual Industry Unit Sales 13,949 Segment % of Total Industry 37.8%

Next Year's Segment Growth Rate 11.7%

Low End Customer Buying Criteria Expectations Importance

1. Price $13.00 - 23.00 53% 2. Age Ideal Age = 7.0 24% 3. Ideal Position Pfmn 3.7 Size 16.3 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 20% 2,763 6/18/2019 3.0 17.0 $18.50 12000 8.60 $1,350 78% $1,056 56% 23 Cedar 17% 2,426 1/29/2014 3.0 17.0 $19.00 12000 8.60 $1,150 70% $1,758 50% 20 Bead 16% 2,241 5/25/2009 3.0 17.0 $18.50 14000 8.60 $900 56% $1,000 34% 19 Dell 14% 1,961 6/19/2019 3.0 17.0 $21.00 14000 8.60 $1,225 76% $1,753 50% 16 Feat 13% 1,796 7/27/2018 3.0 17.0 $21.00 13000 8.60 $1,100 70% $1,278 53% 14 Acre 10% 1,355 11/5/2016 3.8 17.0 $17.40 16000 3.41 $500 30% $500 17% 13 Eat 6% 780 1/15/2017 5.5 14.5 $20.50 13500 4.09 $1,350 79% $1,056 56% 9 Fast 4% 499 1/29/2017 5.5 14.5 $21.00 12000 4.08 $900 57% $710 53% 6 Able 1% 97 10/4/2016 6.4 13.5 $23.50 17000 3.05 $500 31% $500 17% 1 Baker 0% 30 12/23/2016 6.5 12.8 $25.00 17500 2.56 $1,000 63% $1,000 34% 0

CAPSTONE® COURIER Page 6

High End Segment Analysis C58538 Round: 4Dec. 31, 2017

High End Statistics Total Industry Unit Demand 4,656 Actual Industry Unit Sales 4,656 Segment % of Total Industry 12.6%

Next Year's Segment Growth Rate 16.2%

High End Customer Buying Criteria Expectations Importance

1. Ideal Position Pfmn 12.5 Size 7.5 43% 2. Age Ideal Age = 0.0 29% 3. Reliability MTBF 20000-25000 19% 4. Price $28.00 - 38.00 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 28% 1,311 12/26/2017 12.5 7.5 $38.00 25000 1.06 $1,300 74% $1,278 67% 52 Cid 22% 1,033 11/15/2017 12.5 7.5 $37.00 23000 1.13 $1,100 65% $1,758 50% 38 Fox 21% 998 12/22/2017 YES 13.0 7.0 $38.00 25000 0.78 $1,300 58% $1,278 67% 41 Dixie 21% 967 1/1/2018 11.3 8.7 $38.50 24500 2.15 $1,250 77% $1,753 52% 19 Adam 4% 203 11/21/2016 9.6 8.9 $33.00 22000 2.63 $600 35% $660 19% 4 Bid 3% 141 6/9/2016 9.9 10.0 $36.50 22000 3.14 $1,000 60% $700 20% 3 Daze 0% 3 9/18/2017 8.2 11.9 $28.50 18700 1.44 $1,225 77% $1,670 52% 0

CAPSTONE® COURIER Page 7

Performance Segment Analysis C58538 Round: 4Dec. 31, 2017

Performance Statistics Total Industry Unit Demand 3,945 Actual Industry Unit Sales 3,945 Segment % of Total Industry 10.7%

Next Year's Segment Growth Rate 19.8%

Performance Customer Buying Criteria Expectations Importance

1. Reliability MTBF 22000-27000 43% 2. Ideal Position Pfmn 13.4 Size 13.2 29% 3. Price $23.00 - 33.00 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 Coat 23% 907 9/21/2017 13.4 13.2 $32.00 27000 1.42 $1,100 64% $1,591 41% 41 Foam 22% 876 10/7/2017 13.8 12.8 $33.00 27000 1.30 $1,300 74% $1,278 35% 38 Dot 21% 834 10/6/2017 13.8 12.8 $33.50 27000 1.33 $1,200 74% $1,586 42% 37 Doom 19% 746 8/31/2017 13.7 12.9 $33.50 27000 0.86 $1,200 63% $0 42% 33 Aft 9% 347 10/15/2016 YES 11.4 14.6 $29.90 27000 2.54 $600 33% $600 15% 16 Bold 6% 237 7/16/2016 11.4 15.1 $33.00 26000 2.92 $300 24% $300 12% 8

CAPSTONE® COURIER Page 8

Size Segment Analysis C58538 Round: 4Dec. 31, 2017

Size Statistics Total Industry Unit Demand 3,885 Actual Industry Unit Sales 3,885 Segment % of Total Industry 10.5%

Next Year's Segment Growth Rate 18.3%

Size Customer Buying Criteria Expectations Importance

1. Ideal Position Pfmn 6.8 Size 6.6 43% 2. Age Ideal Age = 1.5 29% 3. Reliability MTBF 16000-21000 19% 4. Price $23.00 - 33.00 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 32% 1,241 10/6/2017 7.2 6.4 $33.50 19000 1.29 $1,200 74% $1,586 44% 37 Cure 29% 1,118 9/21/2017 6.8 6.6 $32.00 17000 1.35 $1,150 66% $1,591 43% 37 Fume 25% 977 11/23/2017 6.8 6.0 $33.00 17000 1.18 $1,300 74% $1,278 37% 30 Agape 7% 278 7/30/2016 5.4 8.6 $29.00 19000 3.09 $600 32% $600 19% 5 Buddy 7% 268 5/4/2017 5.4 8.6 $33.00 19000 2.29 $800 45% $800 22% 8 Adam 0% 2 11/21/2016 9.6 8.9 $33.00 22000 2.63 $600 35% $660 19% 0

CAPSTONE® COURIER Page 9

Market Share C58538 Round: 4Dec. 31, 2017

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 10,504 13,949 4,656 3,945 3,885 36,939 Units Demanded 10,504 13,949 4,656 3,945 3,885 36,939 % of Market 28.4% 37.8% 12.6% 10.7% 10.5% 100.0% % of Market 28.4% 37.8% 12.6% 10.7% 10.5% 100.0%

Able 9.4% 0.7% 2.9% Able 8.4% 0.7% 2.7% Acre 9.7% 3.7% Acre 9.7% 3.7% Adam 4.4% 0.6% Adam 3.9% 0.5% Aft 8.8% 0.9% Aft 11.2% 1.2% Agape 7.1% 0.7% Agape 7.1% 0.8% Total 9.4% 10.4% 4.4% 8.8% 7.2% 8.8% Total 8.4% 10.4% 3.9% 11.2% 7.2% 8.8%

Baker 16.8% 0.2% 4.9% Baker 14.9% 0.2% 4.3% Bead 16.1% 6.1% Bead 16.1% 6.1% Bid 3.0% 0.4% Bid 2.7% 0.3% Bold 6.0% 0.6% Bold 5.8% 0.6% Buddy 6.9% 0.7% Buddy 6.9% 0.7% Total 16.8% 16.3% 3.0% 6.0% 6.9% 12.7% Total 14.9% 16.3% 2.7% 5.8% 6.9% 12.1%

Cake 17.8% 5.1% Cake 15.9% 4.5% Cedar 17.4% 6.6% Cedar 17.4% 6.6% Cid 22.2% 2.8% Cid 19.7% 2.5% Coat 23.0% 2.5% Coat 22.4% 2.4% Cure 28.8% 3.0% Cure 28.8% 3.0% Total 17.8% 17.4% 22.2% 23.0% 28.8% 19.9% Total 15.9% 17.4% 19.7% 22.4% 28.8% 19.0%

Daze 18.0% 5.1% Daze 16.1% 4.6% Dell 14.1% 5.3% Dell 14.1% 5.3% Dixie 20.8% 2.6% Dixie 18.4% 2.3% Dot 21.1% 2.3% Dot 20.6% 2.2% Dune 31.9% 3.4% Dune 31.9% 3.4% Doom 18.9% 2.0% Doom 18.4% 2.0% Total 18.0% 14.1% 20.8% 40.0% 31.9% 20.7% Total 16.1% 14.1% 18.5% 39.0% 31.9% 19.7%

Eat 4.3% 5.6% 3.3% Eat 3.8% 5.6% 3.2% Ebb 19.8% 7.5% Ebb 19.8% 7.5% Echo 20.7% 5.9% Echo 18.6% 5.3% Egg 11.3% 3.2% Egg 20.8% 5.9% Total 36.2% 25.4% 19.9% Total 43.2% 25.4% 21.9%

Fast 1.7% 3.6% 1.8% Fast 1.5% 3.6% 1.8% Feat 12.9% 4.9% Feat 12.9% 4.9% Fist 28.2% 3.5% Fist 25.0% 3.2% Foam 22.2% 2.4% Foam 21.6% 2.3% Fume 25.2% 2.6% Fume 25.2% 2.6% Fox 21.4% 2.7% Fox 30.2% 3.8% Total 1.7% 16.5% 49.6% 22.2% 25.2% 18.0% Total 1.5% 16.5% 55.2% 21.6% 25.2% 18.5%

CAPSTONE® COURIER Page 10

Perceptual Map C58538 Round: 4Dec. 31, 2017

Andrews Baldwin Chester Name Pfmn Size Revised Name Pfmn Size Revised Name Pfmn Size Revised Able 6.4 13.5 10/4/2016 Baker 6.5 12.8 12/23/2016 Cake 7.8 12.2 9/14/2017 Acre 3.8 17.0 11/5/2016 Bead 3.0 17.0 5/25/2009 Cedar 3.0 17.0 1/29/2014 Adam 9.6 8.9 11/21/2016 Bid 9.9 10.0 6/9/2016 Cid 12.5 7.5 11/15/2017 Aft 11.4 14.6 10/15/2016 Bold 11.4 15.1 7/16/2016 Coat 13.4 13.2 9/21/2017 Agape 5.4 8.6 7/30/2016 Buddy 5.4 8.6 5/4/2017 Cure 6.8 6.6 9/21/2017 Abum 6.0 15.0 4/17/2016 Ajoy 6.2 15.0 5/1/2016 Apps 5.9 15.0 4/19/2016

Digby Erie Ferris Name Pfmn Size Revised Name Pfmn Size Revised Name Pfmn Size Revised Daze 8.2 11.9 9/18/2017 Eat 5.5 14.5 1/15/2017 Fast 5.5 14.5 1/29/2017 Dell 3.0 17.0 6/19/2019 Ebb 3.0 17.0 6/18/2019 Feat 3.0 17.0 7/27/2018 Dixie 11.3 8.7 1/1/2018 Echo 7.8 12.2 9/14/2017 Fist 12.5 7.5 12/26/2017 Dot 13.8 12.8 10/6/2017 Egg 7.8 12.2 7/21/2017 Foam 13.8 12.8 10/7/2017 Dune 7.2 6.4 10/6/2017 Fume 6.8 6.0 11/23/2017 Doom 13.7 12.9 8/31/2017 Fox 13.0 7.0 12/22/2017

CAPSTONE® COURIER Page 11

HR/TQM Report C58538 Round: 4Dec. 31, 2017

HUMAN RESOURCES SUMMARY Andrews Baldwin Chester Digby Erie Ferris

Needed Complement 531 911 897 1,026 760 1,028 Complement 531 911 897 1,026 760 1,028 1st Shift Complement 521 745 700 813 463 720 2nd Shift Complement 10 166 197 213 297 308

Overtime Percent 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% Turnover Rate 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% New Employees 53 91 132 103 76 144 Separated Employees 0 0 0 11 228 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 $53 $91 $132 $103 $76 $144 Separation Cost $0 $0 $0 $55 $1,140 $0 Training Cost $0 $0 $0 $0 $0 $0 Total HR Admin Cost $53 $91 $132 $158 $1,216 $144

Labor Contract Next Year Wages $25.53 $25.53 $25.53 $25.53 $25.53 $25.53 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 Vendor/JIT $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 C58538 Round: 4Dec. 31, 2017

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 C58538 Round: 4Dec. 31, 2017

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 company's 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 2017 Common

Size

2016

Cash $0 0.0% $0 Account Receivable $6,105 3.9% $5,750 Inventory $107,012 68.4% $110,681 Total Current Assets $113,117 72.3% $116,431

Plant & Equipment $108,400 69.3% $108,400 Accumulated Depreciation ($65,040) -41.6% ($57,813) Total Fixed Assets $43,360 27.7% $50,587 Total Assets $156,477 100.0% $167,018 LIABILITIES & OWNER'S EQUITY

Accounts Payable $4,760 3.0% $4,931 Current Debt $155,312 99.3% $125,793 Long Term Debt $20,850 13.3% $31,775 Total Liabilities $180,922 116.0% $162,499

Common Stock $28,360 18.1% $28,360 Retained Earnings ($52,805) -33.7% ($23,841) Total Equity ($24,445) -15.6% $4,519 Total Liab. & O. Equity $156,477 100.0% $167,018

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 2017 2016 NetIncome(Loss) ($28,964) ($32,474) Depreciation $7,227 $7,227 Extraordinary gains/losses/writeoffs $0 $0 Accounts Payable ($171) ($6,042) Inventory $3,669 ($1,387) Accounts Receivable ($355) ($2,261)

Net cash from operation ($18,594) ($34,937) Cash Flows from Investing Activities Plant Improvements $0 $0 Cash Flows from Financing Activities Dividends Paid $0 $0 Sales of Common Stock $0 $0 Purchase of Common Stock $0 $0 Cash from long term debt $0 $0 Retirement of long term debt ($10,925) $0 Change in current debt(net) $29,518 $34,937

Net Cash from financing activities $18,594 $34,937 Net Change in cash position $0 $0 Closing cash position $0 $0

Annual Report Page 14

Annual Report Andrews C58538 Round: 4Dec. 31, 2017

2017 Income Statement (Product Name) Able Acre Adam Aft Agape Abum Ajoy Apps 2017

Total Common

Size Sales $25,501 $23,581 $6,782 $10,362 $8,054 $0 $0 $0 $74,279 100.0%

Variable Costs: Direct Labor $9,677 $10,444 $2,023 $3,815 $2,827 $0 $0 $0 $28,786 38.8% Direct Material $11,609 $9,662 $3,026 $5,003 $3,502 $0 $0 $0 $32,802 44.2% Inventory Carry $7,902 $2,521 $1,227 $0 $1,192 $0 $0 $0 $12,841 17.3% Total Variable $29,188 $22,627 $6,276 $8,817 $7,520 $0 $0 $0 $74,429 100.2%

Contribution Margin ($3,688) $954 $506 $1,545 $533 $0 $0 $0 ($150) -0.2%

Period Costs: Depreciation $2,640 $2,427 $1,080 $360 $720 $0 $0 $0 $7,227 9.7% SG&A: R&D $0 $0 $0 $0 $0 $0 $0 $0 $0 0.0% Promotions $500 $500 $600 $600 $600 $0 $0 $0 $2,800 3.8% Sales $500 $500 $660 $600 $600 $0 $0 $0 $2,860 3.9% Admin $197 $182 $52 $80 $62 $0 $0 $0 $573 0.8% Total Period $3,837 $3,609 $2,392 $1,640 $1,982 $0 $0 $0 $13,460 18.1%

Net Margin ($7,524) ($2,655) ($1,886) ($95) ($1,449) $0 $0 $0 ($13,610) -18.3%

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 year''s 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 ($13,610) -18.3% Short Term Interest $28,032 37.7% Long Term Interest $2,919 3.9% Taxes ($15,596) -21.0% Profit Sharing $0 0.0% Net Profit ($28,964) -39.0%

Annual Report Page 15