The following is the financial plan for Allensburg’s Food and Gas.
7.1 Break-even Analysis
The monthly break-even point is approximately $49,500.
Break-even Analysis
Monthly Revenue Break-even
$49,539
Assumptions:
Average Percent Variable Cost
72%
Estimated Monthly Fixed Cost
$13,905
7.2 Projected Profit and Loss
The following table and charts highlight the projected profit and loss for three years.
Pro Forma Profit and Loss
Year 1
Year 2
Year 3
Sales
$808,000
$858,000
$910,000
Direct Cost of Sales
$581,200
$611,000
$626,500
Other Production Expenses
$0
$0
$0
Total Cost of Sales
$581,200
$611,000
$626,500
Gross Margin
$226,800
$247,000
$283,500
Gross Margin %
28.07%
28.79%
31.15%
Expenses
Payroll
$117,600
$125,000
$132,000
Sales and Marketing and Other Expenses
$0
$0
$0
Depreciation
$11,424
$11,424
$11,424
Leased Equipment
$0
$0
$0
Utilities
$3,600
$3,600
$3,600
Insurance
$3,600
$3,600
$3,600
Rent
$13,000
$13,000
$13,000
Payroll Taxes
$17,640
$18,750
$19,800
Other
$0
$0
$0
Total Operating Expenses
$166,864
$175,374
$183,424
Profit Before Interest and Taxes
$59,936
$71,626
$100,076
EBITDA
$71,360
$83,050
$111,500
Interest Expense
$13,375
$10,500
$7,500
Taxes Incurred
$13,968
$18,338
$27,773
Net Profit
$32,593
$42,788
$64,803
Net Profit/Sales
4.03%
4.99%
7.12%
7.3 Projected Cash Flow
The following table and chart highlight the projected cash flow for three years.
Pro Forma Cash Flow
Year 1
Year 2
Year 3
Cash Received
Cash from Operations
Cash Sales
$808,000
$858,000
$910,000
Subtotal Cash from Operations
$808,000
$858,000
$910,000
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
$808,000
$858,000
$910,000
Expenditures
Year 1
Year 2
Year 3
Expenditures from Operations
Cash Spending
$117,600
$125,000
$132,000
Bill Payments
$637,424
$681,157
$701,506
Subtotal Spent on Operations
$755,024
$806,157
$833,506
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
$30,000
$30,000
$30,000
Purchase Other Current Assets
$0
$0
$0
Purchase Long-term Assets
$0
$0
$0
Dividends
$0
$0
$0
Subtotal Cash Spent
$785,024
$836,157
$863,506
Net Cash Flow
$22,976
$21,843
$46,494
Cash Balance
$41,476
$63,319
$109,813
7.4 Projected Balance Sheet
The following table and chart highlight the projected balance sheet for three years.
Pro Forma Balance Sheet
Year 1
Year 2
Year 3
Assets
Current Assets
Cash
$41,476
$63,319
$109,813
Inventory
$56,540
$59,439
$60,947
Other Current Assets
$0
$0
$0
Total Current Assets
$98,016
$122,758
$170,760
Long-term Assets
Long-term Assets
$80,000
$80,000
$80,000
Accumulated Depreciation
$11,424
$22,848
$34,272
Total Long-term Assets
$68,576
$57,152
$45,728
Total Assets
$166,592
$179,910
$216,488
Liabilities and Capital
Year 1
Year 2
Year 3
Current Liabilities
Accounts Payable
$55,500
$56,029
$57,804
Current Borrowing
$0
$0
$0
Other Current Liabilities
$0
$0
$0
Subtotal Current Liabilities
$55,500
$56,029
$57,804
Long-term Liabilities
$120,000
$90,000
$60,000
Total Liabilities
$175,500
$146,029
$117,804
Paid-in Capital
$60,000
$60,000
$60,000
Retained Earnings
($101,500)
($68,907)
($26,119)
Earnings
$32,593
$42,788
$64,803
Total Capital
($8,907)
$33,881
$98,684
Total Liabilities and Capital
$166,592
$179,910
$216,488
Net Worth
($8,907)
$33,881
$98,684
7.5 Business Ratios
Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 5541, Gasoline Service Station, are shown for comparison.
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