This spreadsheet supports STUDENT analysis of the case “Guna Fibres, Ltd.” (UVA-F-1687).

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 tosales@dardenbusinesspublishing.com. No part of this publication
may be reproduced, stored in a retrieval system, posted to the Internet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or
otherwise—without the permission of the Darden School Foundation.

Rev. Feb. 1, 2017

 Exhibit 1
GUNA FIBRES, LTD.
Guna Fibres Annual Income Statements (in millions of Indian rupees)

2010 2011
Gross Sales 644.8 758.7
Excise Tax 96.7 113.8
Net Sales 548.1 644.9
Cost of Goods 445.0 538.6
Gross Profits 103.1 106.3
Operating Expenses 35.0 48.3
Depreciation 7.7 9.1
Interest Expense 9.1 12.4
Profit Before Tax 51.4 36.5
Income Tax 15.5 10.9
Net Profit 35.9 25.6

Cash 9.0 7.6

Accounts Receivable 23.9 26.7
Inventory 29.7 34.5
Total Current Assets 62.6 68.8
Gross Plant, Property, and Equipment (PPE) 88.7 100.9
Accumulated Depreciation 11.7 14.8
Net PPE 77.0 86.1
Total Assets 139.6 154.9

Accounts Payable 6.0 8.2

Notes to Bank 0.0 8.0
Accrued Taxes -0.6 -0.9
Total Current Liabilities 5.4 15.3
Owners’ Equity 134.2 139.6
Total Liabilities and Equity 139.6 154.9

Source: All exhibits created by case writer.

 Exhibit 2
GUNA FIBRES, LTD.
Guna Fibres Monthly Sales, 2011 Actual and 2012 Forecast
(in millions of Indian rupees)

2011 2012
(Actual) (Forecast)
January 20.1 26.2
February 23.1 28.9
March 34.2 44.5
April 70.4 88.0
May 120.7 138.9
June 152.9 175.9
July 141.9 163.2
August 71.4 85.8
September 40.2 50.3
October 34.2 44.5
November 27.2 35.3
December 22.1 27.7
Year 758.7 909.0
 Exhibit 5
GUNA FIBRES, LTD.
Guna Fibres Annual Income Statements (in millions of Indian rupees)

Assumptions
Excise Tax Rate 15% Minimum Cash Balance 7.5
Annual Operating Expenses / Annual Gr Sales 6.0% Accounts Receivable Collection
Depreciation / Gross PPE 10% In One Month 40%
Interest Rate on Borrowings (and Deposits) 14.5% In Two Months 60%
Income Tax Rate 30% Purchases / Gr Sales in Two Months 55%
Dividends Paid (in March, June, Sep, Dec) 5.0 Direct Labor / Purchases Last Month 34%
Capital Expenditures (every third month) 3.50
Implied Operating Margin 26.3% Accounts Payable / Purchases 50%
Full year
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 Dec-12 Jan-13 Feb-13
Gross Sales 27.2 22.1 26.2 28.9 44.5 88.0 138.9 175.9 163.2 85.8 50.3 44.5 35.3 27.7 909.0 34.0 36.2
Excise Taxes (1) 3.9 4.3 6.7 13.2 20.8 26.4 24.5 12.9 7.5 6.7 5.3 4.2 136.3
Net Sales 22.2 24.6 37.8 74.8 118.0 149.5 138.7 72.9 42.8 37.8 30.0 23.5 772.6
Cost of Goods Sold (2) 19.3 21.3 32.8 64.9 102.3 129.6 120.2 63.2 37.1 32.8 26.0 20.4 669.9
Gross Profit 3.0 3.3 5.0 9.9 15.7 19.9 18.4 9.7 5.7 5.0 4.0 3.1 102.7
Operating Expenses (3) 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 4.5 54.5
Depreciation (4) 0.8 0.8 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 1.0 10.7
Interest Expense (5) 0.1 0.2 0.6 1.4 2.6 3.7 4.2 3.4 2.0 1.0 0.6 0.4 20.3
Profit Before Taxes -2.5 -2.3 -1.0 3.1 7.7 10.7 8.8 0.9 -1.8 -1.5 -2.1 -2.8 17.2
Income Taxes -0.8 -0.7 -0.3 0.9 2.3 3.2 2.6 0.3 -0.5 -0.4 -0.6 -0.8 5.2
Net Profit -1.8 -1.6 -0.7 2.2 5.4 7.5 6.2 0.6 -1.2 -1.0 -1.5 -2.0 12.0
Dividend 5.0 5.0 5.0 5.0

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 7.6 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.5
Accounts Receivable (6) 26.7 27.7 32.9 50.1 103.0 179.9 247.5 256.9 171.9 90.0 62.9 50.3 37.1
Inventory 34.5 45.1 80.5 140.6 198.4 218.7 166.7 90.2 60.9 51.5 40.6 38.4 44.3
Total Current Assets 68.8 80.3 120.9 198.2 308.9 406.1 421.7 354.6 240.3 149.0 111.0 96.2 88.9
Gross PPE (7) 100.9 100.9 100.9 104.4 104.4 104.4 107.9 107.9 107.9 111.4 111.4 111.4 114.9
Accumulated Depreciation 14.8 15.6 16.5 17.4 18.2 19.1 20.0 20.9 21.8 22.7 23.6 24.6 25.5
Net PPE 86.1 85.3 84.4 87.0 86.2 85.3 87.9 87.0 86.1 88.7 87.8 86.8 89.4
Total Assets 154.9 165.6 205.3 285.2 395.0 491.4 509.6 441.6 326.4 237.7 198.7 183.0 178.3

Accounts Payable (8) 8.2 12.2 24.2 38.2 48.4 44.9 23.6 13.8 12.2 9.7 7.6 9.4 9.9
Note Payable (9) 8.0 17.1 47.2 119.1 215.7 307.9 345.4 278.4 163.9 86.9 51.5 36.1 38.6
Accrued Taxes (10) -0.9 -1.7 -2.4 -2.6 -1.7 0.6 0.0 2.6 2.9 0.0 -0.4 -1.1 -1.9
Total Current Liabilities 15.3 27.7 69.1 154.6 262.3 353.3 369.0 294.9 179.0 96.6 58.6 44.4 46.6
Shareholders’ Equity (11) 139.6 137.9 136.2 130.6 132.7 138.1 140.6 146.8 147.4 141.1 140.1 138.6 131.6
Total Liabilities and Equity 154.9 165.6 205.3 285.2 395.0 491.4 509.6 441.6 326.4 237.7 198.7 183.0 178.3

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 Jul-05
Purchases (12) 14.4 15.9 24.5 48.4 76.4 96.7 89.7 47.2 27.7 24.5 19.4 15.2 18.7 19.9 508.2
Direct Labor and Other Mftg Costs (13) 4.9 5.4 8.3 16.5 26.0 32.9 30.5 16.0 9.4 8.3 6.6 5.2 6.4 171.4
Cost of Goods Sold 19.3 21.3 32.8 64.9 102.3 129.6 120.2 63.2 37.1 32.8 26.0 20.4
Inventory (14) 34.5 45.1 80.5 140.6 198.4 218.7 166.7 90.2 60.9 51.5 40.6 38.4 44.3
Notes:
(1) Gross Sales × Exercise Tax Rate
(2) Gross Sales × (Raw Material Cost % + Direct Labor Cost %)
(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 − 1) − 60% × 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 Labor(t) − COGS(t)
 Exhibit 6
GUNA FIBRES, LTD.
Forecast of Accounts by Month

400

350

300
Millions of Indian rupees

250

200

150

100

50

0
Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12

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 22 25 38 75 118 149 139 73
Accounts Receivable 28 33 50 103 180 247 257 172
Inventory 45 81 141 198 219 167 90 61
Accounts Payable 12 24 38 48 45 24 14 12
Notes Payable 17 47 119 216 308 345 278 164
Aug-12 Sep-12 Oct-12 Nov-12 Dec-12

ble Inventory

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

43 38 30 24
90 63 50 37
52 41 38 44
10 8 9 10
87 51 36 39