This spreadsheet supports STUDENT analysis of the case “Guna Fibres, Ltd.” (Case 12).

This spreadsheet was prepared by Michael J. Schill, Associate Professor of Business Administration. Copyright © 2013 by the University of Virginia Darden School
Foundation, Charlottesville, VA. All rights reserved. For customer service inquiries, send an e-mail [email protected]. No part of this publication
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Feb. 4, 2013
 Exhibit 1
GUNA FIBRES, LTD.
Guna Fibres Annual Income Statements (in thousands of Indian rupees)

2010 2011
Gross Sales 64,487 75,867
Excise Tax 9,673 11,380
Net Sales 54,814 64,487
Cost of Goods 44,496 53,866
Gross Profits 10,318 10,621
Operating Expenses 3,497 4,829
Depreciation 769 909
Interest Expense 910 1,240
Profit Before Tax 5,142 3,644
Income Tax 1,545 1,093
Net Profit 3,597 2,551

Cash 895 762

Accounts Receivable 2,390 2,673
Inventory 2,974 3,450
Total Current Assets 6,259 6,885
Gross Plant, Property, and Equipment 8,868 10,096
Accumulated Depreciation 1,170 1,484
Net Plant, Property, and Equipment 7,698 8,612
Total Assets 13,957 15,497

Accounts Payable 603 822

Notes to Bank 0 798
Accrued Taxes -62 -90
Total Current Liabilities 541 1,530
Owners' Equity 13,416 13,967
Total Liabilities and Equity 13,957 15,497
 Exhibit 2
GUNA FIBRES, LTD.
Guna Fibres Monthly Sales, 2011 Actual and 2012 Forecast
(in thousands of rupees)

2011 2012
(Actual) (Forecast)
January 2,012 2,616
February 2,314 2,892
March 3,421 4,447
April 7,043 8,804
May 12,074 13,885
June 15,294 17,588
July 14,187 16,315
August 7,144 8,576
September 4,025 5,031
October 3,421 4,447
November 2,717 3,531
December 2,214 2,767
Year 75,867 90,899
 Exhibit 5
GUNA FIBRES, LTD.
Monthly Financial Statement Forecast (in thousands of Indian rupees)

Assumptions
Excise Tax Rate 15% Minimum Cash Balance (000s) 750
Cost of Goods Sold / Gr Sales 73.7% Accounts Receivable Collection
Annual Operating Expenses / Annual Gr Sales 6.0% In One Month 40%
Depreciation / Gross PP&E 10% In Two Months 60%
Interest Rate on Borrowings (and Deposits) 14.5% Purchases / Gr Sales in Two Months 55%
Income Tax Rate 30% Direct Labour / Purchases Last Month 34%
Dividends Paid (000s in March, June, Sep, Dec) 500 Capital Expenditures (every third month) 350
Accounts payable / Purchases 50%
Full yea
Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12
Gross Sales (1) 2,717 2,214 2,616 2,892 4,447 8,804 13,885 17,588 16,315 8,576 5,031 4,447 3,531 2,767
Excise Taxes (2) 392 434 667 1,321 2,083 2,638 2,447 1,286 755 667 530 415
Net Sales 2,224 2,458 3,780 7,483 11,802 14,950 13,868 7,290 4,276 3,780 3,001 2,352
Cost of Goods Sold 1,928 2,131 3,277 6,489 10,233 12,962 12,024 6,321 3,708 3,277 2,602 2,039
Gross Profit 296 327 503 995 1,569 1,987 1,844 969 569 503 399 313
Operating Expenses (3) 454 454 454 454 454 454 454 454 454 454 454 454
Depreciation (4) 84 84 87 87 87 90 90 90 93 93 93 96
Interest Expense (5) 10 21 57 144 261 372 417 336 198 105 62 44
Profit Before Taxes -253 -233 -96 309 767 1,071 882 88 -177 -150 -211 -281
Income Taxes -76 -70 -29 93 230 321 265 26 -53 -45 -63 -84
Net Profit -177 -163 -67 217 537 750 617 62 -124 -105 -147 -197
Dividend 500 500 500 500

Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12
Cash 762 750 750 750 750 750 750 750 750 750 750 750 750
Accounts Receivable (6) 2,673 2,773 3,291 5,011 10,301 17,996 24,748 25,697 17,194 9,006 6,295 5,028 3,715
Inventory 3,450 4,509 8,051 14,057 19,838 21,867 16,672 9,019 6,085 5,151 4,056 3,841 4,427
Total Current Assets 6,885 8,032 12,092 19,818 30,889 40,613 42,170 35,466 24,029 14,907 11,100 9,619 8,891
Gross Plant, Property, and Equip (7) 10,096 10,096 10,096 10,446 10,446 10,446 10,796 10,796 10,796 11,146 11,146 11,146 11,496
Accumulated Depreciation 1,484 1,568 1,652 1,739 1,826 1,913 2,003 2,093 2,183 2,276 2,369 2,462 2,558
Net Plant, Property, and Equipment 8,612 8,527 8,443 8,706 8,619 8,532 8,792 8,702 8,612 8,869 8,777 8,684 8,938
Total Assets 15,497 16,559 20,535 28,524 39,508 49,146 50,963 44,168 32,641 23,776 19,877 18,303 17,829

Accounts Payable (8) 822 1,223 2,421 3,818 4,837 4,487 2,358 1,384 1,223 971 761 935 994
Note Payable (9) 798 1,712 4,722 11,910 21,567 30,787 34,541 27,840 16,385 8,687 5,147 3,610 3,858
Accrued Taxes (10) -90 -166 -236 -265 -172 58 0 265 291 0 -45 -108 -192
Total Current Liabilities 1,530 2,769 6,908 15,464 26,232 35,332 36,899 29,488 17,899 9,658 5,863 4,437 4,660
Shareholders' Equity (11) 13,967 13,790 13,627 13,060 13,277 13,813 14,063 14,680 14,742 14,118 14,013 13,866 13,169
Total Liabilities & Equity 15,497 16,559 20,535 28,524 39,508 49,146 50,963 44,168 32,641 23,776 19,877 18,303 17,829

Inventory Detail Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12
Purchases (12) 1,439 1,591 2,446 4,842 7,637 9,673 8,973 4,717 2,767 2,446 1,942 1,522 1,871 1,989
Direct Labour & Other Mftg Costs (1 489 541 832 1,646 2,596 3,289 3,051 1,604 941 832 660 517 636
Cost of Goods Sold 1,928 2,131 3,277 6,489 10,233 12,962 12,024 6,321 3,708 3,277 2,602 2,039
Inventory (14) 3,450 4,509 8,051 14,057 19,838 21,867 16,672 9,019 6,085 5,151 4,056 3,841 4,427

Notes:
(1) Follows forecast in Exhibit 2
(2) Gross Sales * Exercise Tax Rate
(3) Annual Operating Expenses / 12
(4) Gross PPE * Depreciation Rate / 12
(5) Notes Payable (t - 1) * Interest Rate / 12
(6) AR(t - 1) + GSales(t) - 40% * GSales(t - 2) - 60% x GSales(t - 2)
(7) GPPE(t -1) + Capex(t)
(8) 50% * Purchases(t)
(9) Total Assets - AP - AccTax - ShrEquity
(10) AccTax(t - 1) + IncTax(t) or 0 if positive balance and month of quarterly payment
(11) ShrEquity(t - 1) + NetProfit(t) - Dividend(t)
(12) 55% * GSales(t + 2)
(13) 35% * Purchases(t-1)
(14) Inventory(t - 1) + Purchases(t) + Direct Labour(t) - COGS(t)
Full year
2012 Jan-13 Feb-13
90,899 3,401 3,616
13,635
77,264
66,993
10,272
5,454
1,074
2,026
1,717
515
1,202
 2012
50,824
17,145
 Exhibit 6
GUNA FIBRES, LTD.
Forecast of Accounts by Month

40

35

30

25
Millions of Rupees

20

15

10

0
Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 N
Net Sales Accounts Receivable Inventory
Accounts Payable Notes Payable

Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12

Net Sales 2 2 4 7 12 15 14 7
Accounts Receivable 3 3 5 10 18 25 26 17
Inventory 5 8 14 20 22 17 9 6
Accounts Payable 1 2 4 5 4 2 1 1
Notes Payable 2 5 12 22 31 35 28 16
Aug-12 Sep-12 Oct-12 Nov-12 Dec-12
ble Inventory

Sep-12 Oct-12 Nov-12 Dec-12

4 4 3 2
9 6 5 4
5 4 4 4
1 1 1 1
9 5 4 4