The Magnolia Inn is a beautiful facility that sits atop a bluff over looking the Pacific Ocean in scenic Half Moon Bay California. We are a new start-up enterprise that will offer seven wonderfully furnished rooms to guests who want to get away from the ordinary. Each room is individually furnished with antiques and there is a large deck with a hot tub overlooking the ocean. The Magnolia will provide a full breakfast each morning to our guests with no expense spared. Our target market is the professional couple who lives in the San Francisco area, or people looking for a place to honeymoon.
2.1 Company Ownership
The Magnolia Inn is owned and operated solely by Jim and Nancy Anderson. Jim and Nancy have refurbished a beautiful victorian home to accommodate 14 guests at a time in seven rooms. This is a start-up enterprise for the Andersons who are equal owners in the business. Jim and Nancy purchased the property a little over a year ago and have worked this past year preparing to open the Inn.
2.2 Start-up Summary
The start-up costs will come to $38,000 (including cash required at start-up) which will be primarily financed by Jim and Nancy Anderson. Joe Anderson, Jim’s father has contributed $15,000 into the enterprise. The costs of improvements to the building totaled $30,000. Jim and Nancy purchased the property a year ago with the intent of renovating and opening the business.
|Improvements to Inn||$30,000|
|Total Start-up Expenses||$32,000|
|Other Current Assets||$10,000|
|Start-up Expenses to Fund||$32,000|
|Start-up Assets to Fund||$386,000|
|Total Funding Required||$418,000|
|Non-cash Assets from Start-up||$380,000|
|Cash Requirements from Start-up||$6,000|
|Additional Cash Raised||$0|
|Cash Balance on Starting Date||$6,000|
|Liabilities and Capital|
|Accounts Payable (Outstanding Bills)||$0|
|Other Current Liabilities (interest-free)||$0|
|Jim & Nancy Anderson||$50,000|
|Additional Investment Requirement||$0|
|Total Planned Investment||$65,000|
|Loss at Start-up (Start-up Expenses)||($32,000)|
|Total Capital and Liabilities||$386,000|