Case 3-3Dispensers of California, Inc.

Group # 4Diana Lynn C. Ching

Cyma Edel S. AlbaRochelle R. de Guzman

Maikko Ella M. OlayaMarie France A. Cortez

Racquel Angelei L. CastanedaMichelle Gatdula

I. Introduction & Profit Plan

Peter Hynes - Created a new and improved commercial paint spray

Dispensers of California, Inc.- A corporation formed by Peter Hynes and his friends

- Was able to gain a patent for the paint spray with a legal life of 16 years

II. Transaction WorksheetThe diagram shows the impact of the different transactions Peter needs to consider for the business:

III. Trial Balance

IV. Statement of Cash Flow

Cash Balance as shown in the Ending Balance Sheet

V. Income Statement

Retained Earnings as shown in the Ending Balance Sheet

Patent was amortized over its projected useful life of 6 years because it was purchased rather than developed within the company.

Redesign cost expensed

No Inventory left at the end of the period

VI. Ending Balance Sheet

The Dispenser’s of California, Inc. Ending Balance Sheet reflects a Dual Aspect, where we find that the

Total Amount of Assets = Total Amount of Liabilities + Equity

VII. Conclusion/Recommendation

If you were one of Peter Hyne’s friends, would you invest your

money in this company?

☐ YES ☐ NO

VII. Conclusion/RecommendationWould you invest your money in this company? Considerations:☐ Reliability Projected Profit Plan and Financial Statements

☐ Return on Equity

☐ Return on Sales

☐ Current Ratio

= Net Income after TaxTotal Owners’ Equity

= $ 52,500$ 200,000

= 26.25%

✓

✓

= Net Income after Tax Total Revenue

= $ 52,500$ 598,500

= 8.77%✓

= Total Current AssetsTotal Current Liabilities

= $ 93,500 $ 22,500

= 4.16✓

THANK YOU