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Calculation

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Submitted By haldarvivek123
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1) The required Income Statement for the years 2010, 2011 and 2012 is as shown below: Income Statements, 2007 - 2012 ($000s except earnings per share) 2007 Net sales Cost of goods sold Gross margin Research and development Selling, general and administrative Operating income Interest expense Other income (expenses) Income before income taxes Income taxes (a) Net income Earnings per share $77,131 $62,519 $14,612 $3,726 $6,594 $4,292 $480 -$39 $3,773 $1,509 $2,264 $1.52 2008 $80,953 $68,382 $12,571 $4,133 $7,536 $902 $652 -$27 $223 $89 $134 $0.09 2009 $89,250 $72,424 $16,826 $4,416 $7,458 $4,952 $735 -$35 $4,182 $1,673 $2,509 $1.68 2010 2011 2012

$120,000 $144,000 $144,000 $97,320 $22,680 $6,000 $10,032 $6,648 $937 -$50 $5,661 $2,264 $3,396 $2.28 $116,784 $116,784 $27,216 $7,200 $12,038 $7,978 $1,317 -$50 $6,611 $2,644 $3,966 $2.66 $27,216 $7,200 $12,038 $7,978 $1,552 -$50 $6,376 $2,550 $3,826 $2.56

(a) In years 2007 and after, Flash's effective combined federal and state income tax rate was 40%.

Flash Memory, Inc.

Exhibit 2 Balance Sheets, 2007 - 2009 ($000s except number of shares outstanding) December 31, 2008

2007

2009

2010

2011

2012

Cash Accounts receivable Inventories Prepaid expenses Total current assets

$2,536 $10,988 $9,592 $309 $23,425

$2,218 $12,864 $11,072 $324 $26,478

$2,934 $14,671 $11,509 $357 $29,471

$3,960 $19,726 $13,865 $480 $38,031

$4,752 $23,671 $16,638 $576 $45,637

$4,752 $23,671 $16,638 $576 $45,637

Property, plant & equipment at cost Less: Accumulated depreciation Net property, plant & equipment

$5,306 $792 $4,514

$6,116 $1,174 $4,942

$7,282 $1,633 $5,649

$8,182 $2,247 $5,935

$9,082 $2,928 $6,154

$9,982 $3,676 $6,306

Total assets

$27,939

$31,420

$35,120

$43,966

$51,791

$51,943

Accounts payable Notes payable (a) Accrued expenses Income taxes payable (b)

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