Financial Planning Business Plan

Grizzly Bear Financial Managers

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Financial Plan

The following sections will outline important financial information.

7.1 Important Assumptions

The following table details important financial assumptions.

General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 30.00% 30.00% 30.00%
Other 0 0 0

7.2 Break-even Analysis

The Break-even Analysis indicates what will be needed in monthly revenue to reach the break-even point.

Break-even Analysis
Monthly Revenue Break-even $8,518
Assumptions:
Average Percent Variable Cost 8%
Estimated Monthly Fixed Cost $7,837

7.3 Projected Profit and Loss

The following table will indicate projected profit and loss.

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $86,891 $128,000 $147,090
Direct Cost of Sales $6,951 $10,240 $11,767
Other Production Expenses $0 $0 $0
Total Cost of Sales $6,951 $10,240 $11,767
Gross Margin $79,940 $117,760 $135,323
Gross Margin % 92.00% 92.00% 92.00%
Expenses
Payroll $63,120 $67,000 $72,000
Sales and Marketing and Other Expenses $1,200 $1,200 $1,200
Depreciation $456 $456 $456
Leased Equipment $0 $0 $0
Utilities $0 $0 $0
Insurance $1,800 $1,800 $1,800
Rent $18,000 $18,000 $18,000
Payroll Taxes $9,468 $10,050 $10,800
Other $0 $0 $0
Total Operating Expenses $94,044 $98,506 $104,256
Profit Before Interest and Taxes ($14,104) $19,254 $31,067
EBITDA ($13,648) $19,710 $31,523
Interest Expense $0 $0 $0
Taxes Incurred $0 $5,776 $9,320
Net Profit ($14,104) $13,478 $21,747
Net Profit/Sales -16.23% 10.53% 14.78%

7.4 Projected Cash Flow

The following chart and table will indicate projected cash flow.

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $86,891 $128,000 $147,090
Subtotal Cash from Operations $86,891 $128,000 $147,090
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $86,891 $128,000 $147,090
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $63,120 $67,000 $72,000
Bill Payments $34,142 $46,475 $52,409
Subtotal Spent on Operations $97,262 $113,475 $124,409
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $97,262 $113,475 $124,409
Net Cash Flow ($10,371) $14,525 $22,681
Cash Balance $8,429 $22,954 $45,635

7.5 Projected Balance Sheet

The following table will indicate the projected balance sheet.

Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $8,429 $22,954 $45,635
Other Current Assets $0 $0 $0
Total Current Assets $8,429 $22,954 $45,635
Long-term Assets
Long-term Assets $2,300 $2,300 $2,300
Accumulated Depreciation $456 $912 $1,368
Total Long-term Assets $1,844 $1,388 $932
Total Assets $10,273 $24,342 $46,567
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $3,277 $3,868 $4,347
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $3,277 $3,868 $4,347
Long-term Liabilities $0 $0 $0
Total Liabilities $3,277 $3,868 $4,347
Paid-in Capital $22,000 $22,000 $22,000
Retained Earnings ($900) ($15,004) ($1,526)
Earnings ($14,104) $13,478 $21,747
Total Capital $6,996 $20,474 $42,220
Total Liabilities and Capital $10,273 $24,342 $46,567
Net Worth $6,996 $20,474 $42,220

7.6 Business Ratios

The following table outlines some of the more important ratios from the Portfolio Fund Managing industry. The final column, Industry Profile, details specific ratios based on the industry as it is classified by the NAICS code, 523920.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 47.31% 14.91% 11.35%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 34.12%
Total Current Assets 82.05% 94.30% 98.00% 95.71%
Long-term Assets 17.95% 5.70% 2.00% 4.29%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 31.90% 15.89% 9.33% 32.96%
Long-term Liabilities 0.00% 0.00% 0.00% 17.78%
Total Liabilities 31.90% 15.89% 9.33% 50.74%
Net Worth 68.10% 84.11% 90.67% 49.26%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 92.00% 92.00% 92.00% 56.89%
Selling, General & Administrative Expenses 108.23% 81.47% 77.22% 19.06%
Advertising Expenses 0.00% 0.00% 0.00% 4.69%
Profit Before Interest and Taxes -16.23% 15.04% 21.12% 11.71%
Main Ratios
Current 2.57 5.93 10.50 2.34
Quick 2.57 5.93 10.50 2.11
Total Debt to Total Assets 31.90% 15.89% 9.33% 55.75%
Pre-tax Return on Net Worth -201.61% 94.04% 73.58% 2.50%
Pre-tax Return on Assets -137.29% 79.10% 66.71% 5.64%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -16.23% 10.53% 14.78% n.a
Return on Equity -201.61% 65.83% 51.51% n.a
Activity Ratios
Accounts Payable Turnover 11.42 12.17 12.17 n.a
Payment Days 27 28 28 n.a
Total Asset Turnover 8.46 5.26 3.16 n.a
Debt Ratios
Debt to Net Worth 0.47 0.19 0.10 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital $5,152 $19,086 $41,288 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.12 0.19 0.32 n.a
Current Debt/Total Assets 32% 16% 9% n.a
Acid Test 2.57 5.93 10.50 n.a
Sales/Net Worth 12.42 6.25 3.48 n.a
Dividend Payout 0.00 0.00 0.00 n.a
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General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 30.00% 30.00% 30.00%
Other 0 0 0
Break-even Analysis
Monthly Revenue Break-even $8,518
Assumptions:
Average Percent Variable Cost 8%
Estimated Monthly Fixed Cost $7,837
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $86,891 $128,000 $147,090
Direct Cost of Sales $6,951 $10,240 $11,767
Other Production Expenses $0 $0 $0
Total Cost of Sales $6,951 $10,240 $11,767
Gross Margin $79,940 $117,760 $135,323
Gross Margin % 92.00% 92.00% 92.00%
Expenses
Payroll $63,120 $67,000 $72,000
Sales and Marketing and Other Expenses $1,200 $1,200 $1,200
Depreciation $456 $456 $456
Leased Equipment $0 $0 $0
Utilities $0 $0 $0
Insurance $1,800 $1,800 $1,800
Rent $18,000 $18,000 $18,000
Payroll Taxes $9,468 $10,050 $10,800
Other $0 $0 $0
Total Operating Expenses $94,044 $98,506 $104,256
Profit Before Interest and Taxes ($14,104) $19,254 $31,067
EBITDA ($13,648) $19,710 $31,523
Interest Expense $0 $0 $0
Taxes Incurred $0 $5,776 $9,320
Net Profit ($14,104) $13,478 $21,747
Net Profit/Sales -16.23% 10.53% 14.78%
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $86,891 $128,000 $147,090
Subtotal Cash from Operations $86,891 $128,000 $147,090
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $86,891 $128,000 $147,090
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $63,120 $67,000 $72,000
Bill Payments $34,142 $46,475 $52,409
Subtotal Spent on Operations $97,262 $113,475 $124,409
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $97,262 $113,475 $124,409
Net Cash Flow ($10,371) $14,525 $22,681
Cash Balance $8,429 $22,954 $45,635
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $8,429 $22,954 $45,635
Other Current Assets $0 $0 $0
Total Current Assets $8,429 $22,954 $45,635
Long-term Assets
Long-term Assets $2,300 $2,300 $2,300
Accumulated Depreciation $456 $912 $1,368
Total Long-term Assets $1,844 $1,388 $932
Total Assets $10,273 $24,342 $46,567
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $3,277 $3,868 $4,347
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $3,277 $3,868 $4,347
Long-term Liabilities $0 $0 $0
Total Liabilities $3,277 $3,868 $4,347
Paid-in Capital $22,000 $22,000 $22,000
Retained Earnings ($900) ($15,004) ($1,526)
Earnings ($14,104) $13,478 $21,747
Total Capital $6,996 $20,474 $42,220
Total Liabilities and Capital $10,273 $24,342 $46,567
Net Worth $6,996 $20,474 $42,220
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 47.31% 14.91% 11.35%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 34.12%
Total Current Assets 82.05% 94.30% 98.00% 95.71%
Long-term Assets 17.95% 5.70% 2.00% 4.29%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 31.90% 15.89% 9.33% 32.96%
Long-term Liabilities 0.00% 0.00% 0.00% 17.78%
Total Liabilities 31.90% 15.89% 9.33% 50.74%
Net Worth 68.10% 84.11% 90.67% 49.26%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 92.00% 92.00% 92.00% 56.89%
Selling, General & Administrative Expenses 108.23% 81.47% 77.22% 19.06%
Advertising Expenses 0.00% 0.00% 0.00% 4.69%
Profit Before Interest and Taxes -16.23% 15.04% 21.12% 11.71%
Main Ratios
Current 2.57 5.93 10.50 2.34
Quick 2.57 5.93 10.50 2.11
Total Debt to Total Assets 31.90% 15.89% 9.33% 55.75%
Pre-tax Return on Net Worth -201.61% 94.04% 73.58% 2.50%
Pre-tax Return on Assets -137.29% 79.10% 66.71% 5.64%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -16.23% 10.53% 14.78% n.a
Return on Equity -201.61% 65.83% 51.51% n.a
Activity Ratios
Accounts Payable Turnover 11.42 12.17 12.17 n.a
Payment Days 27 28 28 n.a
Total Asset Turnover 8.46 5.26 3.16 n.a
Debt Ratios
Debt to Net Worth 0.47 0.19 0.10 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital $5,152 $19,086 $41,288 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.12 0.19 0.32 n.a
Current Debt/Total Assets 32% 16% 9% n.a
Acid Test 2.57 5.93 10.50 n.a
Sales/Net Worth 12.42 6.25 3.48 n.a
Dividend Payout 0.00 0.00 0.00 n.a