Liquid Culture
Financial Plan
Forecast
Key Assumptions
We assume a successful ramp-up. Yes, sales forecast is probably too optimistic. But we believe there is a real market window, real need, and the climate is right.
Revenue by Month
Expenses by Month
Net Profit (or Loss) by Year
Financing
Use of Funds
Liquid Culture’s start-up costs consists mostly of design and marketing. Liquid Culture has $260,000 in investments and $200,000 in a short-term loan.
To Be more specific, start-up expenses are listed as:
Legal $1,000
Office expenses $500
Consultants $5,000
Rent $2,000
Leased Office Equipment $10,000
Computer Equipment/Software $30,000
Website $10,000
Totaling : $58,500
We will also be purchasing $401,500 of long term assets
Sources of Funds
We will be getting $460,000, which includes:
$130,000 from founder 1
130,000 from founder 2
Short term loan of $200,000
Statements
Projected Profit & Loss
2020 | 2021 | 2022 | |
---|---|---|---|
Revenue | $2,170,000 | $2,230,000 | $2,295,000 |
Direct Costs | $933,100 | $958,900 | $986,850 |
Gross Margin | $1,236,900 | $1,271,100 | $1,308,150 |
Gross Margin % | 57% | 57% | 57% |
Operating Expenses | |||
Salaries & Wages | $616,800 | $629,136 | $641,719 |
Employee Related Expenses | $123,360 | $125,827 | $128,344 |
Rent | $24,000 | $24,000 | $24,000 |
Utilities | $6,000 | $6,000 | $6,000 |
Marketing | $325,500 | $334,500 | $344,250 |
Sales Expense | $21,600 | $21,600 | $21,600 |
Total Operating Expenses | $1,117,260 | $1,141,063 | $1,165,913 |
Operating Income | $119,640 | $130,037 | $142,237 |
Interest Incurred | $6,560 | ||
Depreciation and Amortization | |||
Gain or Loss from Sale of Assets | |||
Income Taxes | $16,962 | $19,506 | $21,335 |
Total Expenses | $2,073,882 | $2,119,469 | $2,174,098 |
Net Profit | $96,118 | $110,531 | $120,902 |
Net Profit/Sales | 4% | 5% | 5% |
Projected Balance Sheet
Starting Balances | 2020 | 2021 | 2022 | |
---|---|---|---|---|
Cash | $401,500 | $382,497 | $436,071 | $558,857 |
Accounts Receivable | $81,000 | $40,140 | $41,310 | |
Inventory | $159,817 | $164,475 | $164,475 | |
Other Current Assets | ||||
Total Current Assets | $401,500 | $623,314 | $640,686 | $764,642 |
Long-Term Assets | ||||
Accumulated Depreciation | ||||
Total Long-Term Assets | ||||
Total Assets | $401,500 | $623,314 | $640,686 | $764,642 |
Accounts Payable | $224,733 | $183,060 | $184,360 | |
Income Taxes Payable | $16,962 | $4,877 | $5,331 | |
Sales Taxes Payable | $84,000 | $44,600 | $45,900 | |
Short-Term Debt | $200,000 | |||
Prepaid Revenue | ||||
Total Current Liabilities | $200,000 | $325,695 | $232,537 | $235,591 |
Long-Term Debt | $0 | $0 | $0 | $0 |
Long-Term Liabilities | $0 | $0 | $0 | $0 |
Total Liabilities | $200,000 | $325,695 | $232,537 | $235,591 |
Paid-In Capital | $260,000 | $260,000 | $260,000 | $260,000 |
Retained Earnings | ($58,500) | ($58,500) | $37,618 | $148,149 |
Earnings | $96,118 | $110,531 | $120,902 | |
Total Owner’s Equity | $201,500 | $297,618 | $408,149 | $529,051 |
Total Liabilities & Equity | $401,500 | $623,314 | $640,686 | $764,642 |
Projected Cash Flow Statement
2020 | 2021 | 2022 | |
---|---|---|---|
Net Cash Flow from Operations | |||
Net Profit | $96,118 | $110,531 | $120,902 |
Depreciation & Amortization | |||
Change in Accounts Receivable | ($81,000) | $40,860 | ($1,170) |
Change in Inventory | ($159,817) | ($4,658) | $0 |
Change in Accounts Payable | $224,733 | ($41,673) | $1,300 |
Change in Income Tax Payable | $16,962 | ($12,085) | $454 |
Change in Sales Tax Payable | $84,000 | ($39,400) | $1,300 |
Change in Prepaid Revenue | |||
Net Cash Flow from Operations | $180,997 | $53,574 | $122,786 |
Investing & Financing | |||
Assets Purchased or Sold | |||
Net Cash from Investing | |||
Investments Received | |||
Dividends & Distributions | |||
Change in Short-Term Debt | ($200,000) | ||
Change in Long-Term Debt | $0 | $0 | $0 |
Net Cash from Financing | ($200,000) | $0 | $0 |
Cash at Beginning of Period | $401,500 | $382,497 | $436,071 |
Net Change in Cash | ($19,003) | $53,574 | $122,786 |
Cash at End of Period | $382,497 | $436,071 | $558,857 |