We project that we will be able to generate sufficient capital from operations to meet our initial needs after the infusion of $200,000. However, our projections are in industries that have never been fully addressed and are based upon present real buying conditions and our own experience. Should sales not be up to projections, adjustments will be made in ordering and long term commitments decreased or postponed. Income Statement Assumptions: Returns, discounts: We are offering a range of quantity discounts, plus an early payment discount to those extended credit. Average is estimated to be 5%. Cost of goods sold: Expenses: Totaled from Cash Flow Analysis spreadsheets. Freight: Paid by customers. Risks & Variables: SAMPLE: We have considered seasonal trends and have forecasted accordingly. [I/We] believe the forecasts are conservative.
Proforma Balance Sheet Cost Control SAMPLE: Our books will initially be maintained manually. [My Company] seeks at a future point to use a computerized accounting package to monitor our financial performance. This information will be compiled at the end of each month for preparation of financial statements. Each month these statements will be reviewed against our proformas and appropriate action taken to adjust costs or our budget. If we find that we are continually over budget, our first step will be to reevaluate our markup on products and then to recheck our costs to make certain that we are obtaining the best possible prices. Ratio Analysis Financial ratios are included for your convenience. Financial Standards We have also included financial standards as compiled by Dun & Bradstreet and Robert Morris Associates. Breakeven Point Taken from BPMBREAK.WK1 spreadsheet. SAMPLE: The following chart shows our breakeven point: Profit Revenue Fixed Costs Variable Costs $0 $20,000.00 $3,900.00 $16,100.00 It is intended that [My Company] will be profitable in the XXX Quarter, 199X.
Effects of Loan or Investment SAMPLE: The money invested in [My Company] will be used for the following purposes: § Purchase of DEF Machine, Model # 333058 including installation - ($150,000) § Working capital - ($50,000) § Leasehold improvements - (est. $15,000) § Laboratory equipment - Beakers, test tubes, petrie dishes - ($1,500) § Startup costs - legal fees, filing fees § Inventory -raw materials - ($25,000) § Delivery trucks (GMC Model 80, $10,995) § Computer equipment - 15 Austin 486/33 Winstations - ($40,425) These outlays will enable us to operate at a level that will allow us to meet our conservative sales goals for the first year. This will also allow us to outright purchase these items rather than finance or lease them. Attachments: --------------- |
