Chemalite Inc Memo

Cash is King Accountants

Memo

To: Stockholders of Chemalite, Inc.

From: Jon Smart

CC: Tim Mofit

Date: 4/12/2008

Re: Financial Performance of Chemalite, Inc.

The purpose of this memo is to present the financial performance of Chemalite, Inc. to the stockholders of the company.

Analysis

Chemalite, Inc. is a new company that is performing very well and additionally has a very bright future. The following topics will explain:

• Assets

• Cash Flow

• Income

• Future

Assets: Current assets total $439,375.00 with $113,000.00 of that being liquid cash. The company has no liabilities, meaning that it owes no money.

Cash Flow: A big concern for all of the stockholders was the negative cash flows that they observed. All of the negative cash flows for the period are attributed to investing and the sale/purchase of inventory which should in turn result in additional positive cash flow. In addition, there was a positive change in cash for the total period of $113,000.00.

Income: The Company has a positive net income of $39,375.00 which is approximately five percent of net sales.

Future: The future looks bright for Chemalite, Inc. as there is a guaranteed $90,000.00 purchase to get the next year started. In addition, with no liabilities, the company can look to invest much further into the production of their product.

Conclusion

Chemalite,