Skate Park NW

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Skate Park Skiing Business Plan

Financial Plan

The following sections will outline important financial information.

8.1 Important Assumptions

The following table details Important 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

8.2 Break-even Analysis

The Break-even analysis indicates that approximately $13,500 will be needed in monthly revenue to reach the Break-even point.

Break-even Analysis
Monthly Revenue Break-even $13,588
Assumptions:
Average Percent Variable Cost 14%
Estimated Monthly Fixed Cost $11,683

8.3 Projected Profit and Loss

The following table and charts will indicate Projected Profit and Loss.

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $125,717 $235,082 $276,221
Direct Cost of Sales $17,625 $41,385 $49,573
Other Costs of Sales $0 $0 $0
Total Cost of Sales $17,625 $41,385 $49,573
Gross Margin $108,092 $193,698 $226,647
Gross Margin % 85.98% 82.40% 82.05%
Expenses
Payroll $84,000 $97,000 $109,000
Sales and Marketing and Other Expenses $3,600 $3,600 $3,600
Depreciation $13,992 $13,992 $13,992
Rent $16,500 $21,000 $21,000
Utilities $4,700 $5,300 $5,600
Insurance $4,800 $4,800 $4,800
Payroll Taxes $12,600 $14,550 $16,350
Other $0 $0 $0
Total Operating Expenses $140,192 $160,242 $174,342
Profit Before Interest and Taxes ($32,100) $33,456 $52,305
EBITDA ($18,108) $47,448 $66,297
Interest Expense $0 $0 $0
Taxes Incurred $0 $10,037 $15,692
Net Profit ($32,100) $23,419 $36,614
Net Profit/Sales -25.53% 9.96% 13.26%

8.4 Projected Cash Flow

The following table and chart will indicate Projected Cash Flow.

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $125,717 $235,082 $276,221
Subtotal Cash from Operations $125,717 $235,082 $276,221
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 $125,717 $235,082 $276,221
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $84,000 $97,000 $109,000
Bill Payments $51,788 $100,434 $115,304
Subtotal Spent on Operations $135,788 $197,434 $224,304
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 $135,788 $197,434 $224,304
Net Cash Flow ($10,071) $37,648 $51,916
Cash Balance $42,873 $80,522 $132,438

8.5 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 $42,873 $80,522 $132,438
Other Current Assets $0 $0 $0
Total Current Assets $42,873 $80,522 $132,438
Long-term Assets
Long-term Assets $70,000 $70,000 $70,000
Accumulated Depreciation $13,992 $27,984 $41,976
Total Long-term Assets $56,008 $42,016 $28,024
Total Assets $98,881 $122,538 $160,462
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $8,037 $8,274 $9,585
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $8,037 $8,274 $9,585
Long-term Liabilities $0 $0 $0
Total Liabilities $8,037 $8,274 $9,585
Paid-in Capital $190,000 $190,000 $190,000
Retained Earnings ($67,056) ($99,156) ($75,737)
Earnings ($32,100) $23,419 $36,614
Total Capital $90,844 $114,263 $150,877
Total Liabilities and Capital $98,881 $122,538 $160,462
Net Worth $90,844 $114,263 $150,877

8.6 Business Ratios

The following table indicates the Business Ratios for this plan as well as the industry.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 86.99% 17.50% 3.50%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 27.24%
Total Current Assets 43.36% 65.71% 82.54% 33.11%
Long-term Assets 56.64% 34.29% 17.46% 66.89%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 8.13% 6.75% 5.97% 13.25%
Long-term Liabilities 0.00% 0.00% 0.00% 37.31%
Total Liabilities 8.13% 6.75% 5.97% 50.56%
Net Worth 91.87% 93.25% 94.03% 49.44%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 85.98% 82.40% 82.05% 100.00%
Selling, General & Administrative Expenses 111.51% 72.43% 68.80% 75.44%
Advertising Expenses 0.00% 0.00% 0.00% 1.71%
Profit Before Interest and Taxes -25.53% 14.23% 18.94% 1.72%
Main Ratios
Current 5.33 9.73 13.82 1.31
Quick 5.33 9.73 13.82 0.97
Total Debt to Total Assets 8.13% 6.75% 5.97% 57.21%
Pre-tax Return on Net Worth -35.33% 29.28% 34.67% 1.10%
Pre-tax Return on Assets -32.46% 27.30% 32.60% 2.56%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -25.53% 9.96% 13.26% n.a
Return on Equity -35.33% 20.50% 24.27% n.a
Activity Ratios
Accounts Payable Turnover 7.44 12.17 12.17 n.a
Payment Days 27 30 28 n.a
Total Asset Turnover 1.27 1.92 1.72 n.a
Debt Ratios
Debt to Net Worth 0.09 0.07 0.06 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital $34,836 $72,247 $122,853 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.79 0.52 0.58 n.a
Current Debt/Total Assets 8% 7% 6% n.a
Acid Test 5.33 9.73 13.82 n.a
Sales/Net Worth 1.38 2.06 1.83 n.a
Dividend Payout 0.00 0.00 0.00 n.a