Noah's Arf
Financial Plan
The following is Noah’s Arf’s financial plan.
7.1 Important Assumptions
The following table summarizes key financial assumptions, including payment for services in cash or credit card. We assume fast-growth and large demands in this new specialized service.
General Assumptions | |||
Year 1 | Year 2 | Year 3 | |
Plan Month | 1 | 2 | 3 |
Current Interest Rate | 0.00% | 0.00% | 0.00% |
Long-term Interest Rate | 9.00% | 9.00% | 9.00% |
Tax Rate | 25.42% | 25.00% | 25.42% |
Other | 0 | 0 | 0 |
7.2 Key Financial Indicators
The benchmark comparison chart highlights our ambitious plan. We feel this is a new fast growing service offered to the community. The opportunity to expand services is endless.

7.3 Break-even Analysis
For our break-even analysis, we assume monthly costs which include our full payroll, rent, and utilities, and an estimation of other running expenses.

Break-even Analysis | |
Monthly Revenue Break-even | $13,340 |
Assumptions: | |
Average Percent Variable Cost | 4% |
Estimated Monthly Fixed Cost | $12,781 |
7.4 Projected Profit and Loss
Month-by-month forecasts for profit and loss are included in the appendix.




Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $318,410 | $307,376 | $355,338 |
Direct Cost of Sales | $13,335 | $17,005 | $19,670 |
Production Payroll | $34,200 | $102,768 | $106,176 |
Other | $0 | $0 | $0 |
Total Cost of Sales | $47,535 | $119,773 | $125,846 |
Gross Margin | $270,875 | $187,603 | $229,492 |
Gross Margin % | 85.07% | 61.03% | 64.58% |
Operating Expenses | |||
Sales and Marketing Expenses | |||
Sales and Marketing Payroll | $0 | $0 | $0 |
Advertising/Promotion | $2,700 | $5,500 | $7,000 |
Travel | $0 | $0 | $0 |
Miscellaneous | $600 | $1,000 | $1,000 |
Total Sales and Marketing Expenses | $3,300 | $6,500 | $8,000 |
Sales and Marketing % | 1.04% | 2.11% | 2.25% |
General and Administrative Expenses | |||
General and Administrative Payroll | $52,560 | $60,672 | $61,344 |
Sales and Marketing and Other Expenses | $0 | $0 | $0 |
Depreciation | $12,000 | $12,000 | $12,000 |
vehicle maintence | $1,200 | $1,500 | $1,700 |
Utilities | $14,400 | $15,000 | $15,500 |
Insurance | $12,000 | $13,000 | $14,000 |
Taxes | $6,000 | $7,000 | $8,000 |
Rent | $38,500 | $3,600 | $3,800 |
Payroll Taxes | $10,411 | $19,613 | $20,102 |
Other General and Administrative Expenses | $0 | $0 | $0 |
Total General and Administrative Expenses | $147,071 | $132,385 | $136,446 |
General and Administrative % | 46.19% | 43.07% | 38.40% |
Other Expenses: | |||
Other Payroll | $0 | $0 | $0 |
Consultants | $0 | $0 | $0 |
Contract/Consultants | $3,000 | $4,000 | $5,000 |
Total Other Expenses | $3,000 | $4,000 | $5,000 |
Other % | 0.94% | 1.30% | 1.41% |
Total Operating Expenses | $153,371 | $142,885 | $149,446 |
Profit Before Interest and Taxes | $117,504 | $44,718 | $80,046 |
EBITDA | $129,504 | $56,718 | $92,046 |
Interest Expense | $8,210 | $6,630 | $5,050 |
Taxes Incurred | $26,884 | $9,522 | $19,061 |
Net Profit | $82,410 | $28,566 | $55,934 |
Net Profit/Sales | 25.88% | 9.29% | 15.74% |
7.5 Projected Cash Flow
The following chart and table show the project cash flow for Noah’s Arf.

Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $318,410 | $307,376 | $355,338 |
Subtotal Cash from Operations | $318,410 | $307,376 | $355,338 |
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 | $318,410 | $307,376 | $355,338 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $86,760 | $163,440 | $167,520 |
Bill Payments | $121,390 | $109,197 | $118,933 |
Subtotal Spent on Operations | $208,150 | $272,637 | $286,453 |
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 | $17,556 | $17,556 | $17,556 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $225,706 | $290,193 | $304,009 |
Net Cash Flow | $92,704 | $17,183 | $51,329 |
Cash Balance | $131,704 | $148,887 | $200,216 |
7.6 Projected Balance Sheet
The Projected Balance Sheet is quite solid. We do not project any real trouble meeting our debt obligations–as long as we can achieve our specific objectives.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $131,704 | $148,887 | $200,216 |
Inventory | $1,974 | $2,517 | $2,912 |
Other Current Assets | $0 | $0 | $0 |
Total Current Assets | $133,678 | $151,405 | $203,128 |
Long-term Assets | |||
Long-term Assets | $100,000 | $100,000 | $100,000 |
Accumulated Depreciation | $12,000 | $24,000 | $36,000 |
Total Long-term Assets | $88,000 | $76,000 | $64,000 |
Total Assets | $221,678 | $227,405 | $267,128 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $13,824 | $8,541 | $9,886 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $13,824 | $8,541 | $9,886 |
Long-term Liabilities | $82,444 | $64,888 | $47,332 |
Total Liabilities | $96,268 | $73,429 | $57,218 |
Paid-in Capital | $70,000 | $70,000 | $70,000 |
Retained Earnings | ($27,000) | $55,410 | $83,976 |
Earnings | $82,410 | $28,566 | $55,934 |
Total Capital | $125,410 | $153,976 | $209,910 |
Total Liabilities and Capital | $221,678 | $227,405 | $267,128 |
Net Worth | $125,410 | $153,976 | $209,910 |
7.7 Business Ratios
The table follows with our main business ratios. We intend to improve gross margins and inventory turnover. Industry profile ratios based on the Standard Industrial Classification (SIC) code 0752, Animal Specialty Services, nec., are shown for comparison.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | -3.47% | 15.60% | -2.90% |
Percent of Total Assets | ||||
Inventory | 0.89% | 1.11% | 1.09% | 8.20% |
Other Current Assets | 0.00% | 0.00% | 0.00% | 31.90% |
Total Current Assets | 60.30% | 66.58% | 76.04% | 55.90% |
Long-term Assets | 39.70% | 33.42% | 23.96% | 44.10% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 6.24% | 3.76% | 3.70% | 32.70% |
Long-term Liabilities | 37.19% | 28.53% | 17.72% | 19.90% |
Total Liabilities | 43.43% | 32.29% | 21.42% | 52.60% |
Net Worth | 56.57% | 67.71% | 78.58% | 47.40% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 85.07% | 61.03% | 64.58% | 42.50% |
Selling, General & Administrative Expenses | 59.33% | 51.74% | 48.76% | 26.40% |
Advertising Expenses | 0.85% | 1.79% | 1.97% | 0.50% |
Profit Before Interest and Taxes | 36.90% | 14.55% | 22.53% | 2.40% |
Main Ratios | ||||
Current | 9.67 | 17.73 | 20.55 | 2.19 |
Quick | 9.53 | 17.43 | 20.25 | 1.48 |
Total Debt to Total Assets | 43.43% | 32.29% | 21.42% | 52.60% |
Pre-tax Return on Net Worth | 87.15% | 24.74% | 35.73% | 4.50% |
Pre-tax Return on Assets | 49.30% | 16.75% | 28.07% | 9.40% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 25.88% | 9.29% | 15.74% | n.a |
Return on Equity | 65.71% | 18.55% | 26.65% | n.a |
Activity Ratios | ||||
Inventory Turnover | 6.20 | 7.57 | 7.25 | n.a |
Accounts Payable Turnover | 9.78 | 12.17 | 12.17 | n.a |
Payment Days | 27 | 39 | 28 | n.a |
Total Asset Turnover | 1.44 | 1.35 | 1.33 | n.a |
Debt Ratios | ||||
Debt to Net Worth | 0.77 | 0.48 | 0.27 | n.a |
Current Liab. to Liab. | 0.14 | 0.12 | 0.17 | n.a |
Liquidity Ratios | ||||
Net Working Capital | $119,854 | $142,864 | $193,242 | n.a |
Interest Coverage | 14.31 | 6.74 | 15.85 | n.a |
Additional Ratios | ||||
Assets to Sales | 0.70 | 0.74 | 0.75 | n.a |
Current Debt/Total Assets | 6% | 4% | 4% | n.a |
Acid Test | 9.53 | 17.43 | 20.25 | n.a |
Sales/Net Worth | 2.54 | 2.00 | 1.69 | n.a |
Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |