Income Statement - 1H03Chemalite, Inc.Income Statement from January 1, 2003 to June 30, 2003Sales$0Cost of Sales$0Gross Profit$0Depreciation Expenses$0Operating Expense($7,500)Net Income($7,500)

Cash Flows - 1H03Chemalite, Inc.Cash Flows Statement from January 1, 2003 to June 30, 2003Cash flows from Operating ActivitiesCash collections$0Cash payments for purchases($75,000)Cash payments for operating expenses($7,500)Interest and taxes$0Total cash payments($82,500)Net cash provided by operating activities($82,500)Cash flows from InvestingPurchase of hard assets (machinery)($62,500)Total Cash flows from investing($62,500)Cash flows from FinancingSale of stock$375,000Total cash flow from financing$375,000Cash SummaryCash on January 1, 2003$375,000Net Change in Cash($145,000)Cash on June 30, 2003$230,000

Balance Sheet - 1H03Chemalite, Inc.Balance Sheet for June 30, 2003AssetsCurrent AssetsCash$230,000Accounts Receivable$0Inventory$75,000Total current assets$305,000Fixed AssetsEquipment$62,500Patent$125,000Total fixed assets$187,500Intangible assets$0Total assets$492,500Liabilities and Shareholders EquityLiabilitiesCurrent LiabilitiesAccounts payable$0Taxes payable$0Total Current Liabilities$0Long-term liabilitiesLong-term loans$0Total liabilities$0Shareholders' EquityCommon Stock$500,000Retained Earnings($7,500)Total shareholders' equity$492,500Total liabilities and shareholders' equity$492,500

Equals the Net Income from the Income StatementEquals the Ending Cash from the Cash Flow Statement

Income Statement - 2003Chemalite, Inc.Income Statement for the year ending Deceber 31, 2003Sales$754,500Cost of SalesMaterials($195,000)Manufacturing($350,000)Total COGS($545,000)Gross Profit$209,500Gross Margin28%Depreciation Expense($25,000)Operating Expense($133,750)Operating Income$50,750Interest Expense($750)Net Income before Taxes$50,000Income TaxesNet Income after Taxes$50,000

Balance Sheet - 2003Chemalite, Inc.Balance Sheet for the year ending Deceber 31, 2003AssetsCurrent AssetsCash$113,000Accounts Receivable$69,500Inventory$55,000Total current assets$237,500Fixed AssetsEquipment$212,500Patent$100,000Total fixed assets$312,500Intangible assets$0Total assets$550,000Liabilities and Shareholders EquityLiabilitiesCurrent LiabilitiesAccounts payable$0Taxes payable$0Total Current Liabilities$0Long-term liabilitiesLong-term loans$0Total liabilities$0Shareholders' EquityCommon Stock$500,000Retained Earnings$50,000Total shareholders' equity$550,000Total liabilities and shareholders' equity$550,000

Equals the Ending Cash from the Cash Flow StatementEqual to the Net Income on the Income Statement

Cash Flows - 2003Chemalite, Inc.Cash Flows Statement for the year ending Deceber 31, 2003Cash flows from Operating ActivitiesCash collections$685,000Cash payments for purchases($600,000)Cash payments for operating expenses($133,750)Interest($750)Tax$0Total cash payments($734,500)Net cash provided by operating activities($49,500)Cash flows from InvestingPurchase of hard assets (machinery)($212,500)Total Cash flows from investing($212,500)Cash flows from FinancingSale of stock$375,000Total cash flow from financing$375,000Cash SummaryNet Change in Cash$113,000Cash on January 1, 2003$0Cash on June 30, 2003$113,000