Transitional Housing of Pittsburgh
Financial Plan
The following sections outline important financial information.
8.1 Important Assumptions
The following table includes important financial 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 | 0.00% | 0.00% | 0.00% |
| Other | 0 | 0 | 0 |
8.2 Break-even Analysis
The Break-even Analysis is shown in the following table and chart.
| Break-even Analysis | |
| Monthly Revenue Break-even | $17,643 |
| Assumptions: | |
| Average Percent Variable Cost | 14% |
| Estimated Monthly Fixed Cost | $15,118 |
8.3 Projected Surplus or Deficit
The following table and charts show projected surplus and deficit.
| Surplus and Deficit | |||
| Year 1 | Year 2 | Year 3 | |
| Funding | $304,000 | $295,000 | $307,000 |
| Direct Cost | $43,500 | $41,625 | $43,485 |
| Other Costs of Funding | $0 | $0 | $0 |
| Total Direct Cost | $43,500 | $41,625 | $43,485 |
| Gross Surplus | $260,500 | $253,375 | $263,515 |
| Gross Surplus % | 85.69% | 85.89% | 85.84% |
| Expenses | |||
| Payroll | $82,800 | $141,600 | $147,600 |
| Account Name | $0 | $0 | $0 |
| Depreciation | $4,596 | $4,596 | $4,596 |
| Leased Building | $48,000 | $48,000 | $48,000 |
| Utilities | $24,000 | $24,000 | $24,000 |
| Insurance | $9,600 | $9,600 | $9,600 |
| Payroll Taxes | $12,420 | $21,240 | $22,140 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $181,416 | $249,036 | $255,936 |
| Surplus Before Interest and Taxes | $79,084 | $4,339 | $7,579 |
| EBITDA | $83,680 | $8,935 | $12,175 |
| Interest Expense | $0 | $0 | $0 |
| Taxes Incurred | $0 | $0 | $0 |
| Net Surplus | $79,084 | $4,339 | $7,579 |
| Net Surplus/Funding | 26.01% | 1.47% | 2.47% |
8.4 Projected Cash Flow
The following table and chart illustrate projected cash flow.
| Pro Forma Cash Flow | |||
| Year 1 | Year 2 | Year 3 | |
| Cash Received | |||
| Cash from Operations | |||
| Cash Funding | $304,000 | $295,000 | $307,000 |
| Subtotal Cash from Operations | $304,000 | $295,000 | $307,000 |
| 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 | $304,000 | $295,000 | $307,000 |
| Expenditures | Year 1 | Year 2 | Year 3 |
| Expenditures from Operations | |||
| Cash Spending | $82,800 | $141,600 | $147,600 |
| Bill Payments | $129,040 | $141,071 | $146,998 |
| Subtotal Spent on Operations | $211,840 | $282,671 | $294,598 |
| 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 | $211,840 | $282,671 | $294,598 |
| Net Cash Flow | $92,160 | $12,329 | $12,402 |
| Cash Balance | $110,160 | $122,489 | $134,891 |
8.5 Projected Balance Sheet
The following table shows the projected balance sheet.
| Pro Forma Balance Sheet | |||
| Year 1 | Year 2 | Year 3 | |
| Assets | |||
| Current Assets | |||
| Cash | $110,160 | $122,489 | $134,891 |
| Other Current Assets | $23,000 | $23,000 | $23,000 |
| Total Current Assets | $133,160 | $145,489 | $157,891 |
| Long-term Assets | |||
| Long-term Assets | $0 | $0 | $0 |
| Accumulated Depreciation | $4,596 | $9,192 | $13,788 |
| Total Long-term Assets | ($4,596) | ($9,192) | ($13,788) |
| Total Assets | $128,564 | $136,297 | $144,103 |
| Liabilities and Capital | Year 1 | Year 2 | Year 3 |
| Current Liabilities | |||
| Accounts Payable | $8,480 | $11,874 | $12,101 |
| Current Borrowing | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 |
| Subtotal Current Liabilities | $8,480 | $11,874 | $12,101 |
| Long-term Liabilities | $0 | $0 | $0 |
| Total Liabilities | $8,480 | $11,874 | $12,101 |
| Paid-in Capital | $45,000 | $45,000 | $45,000 |
| Accumulated Surplus/Deficit | ($4,000) | $75,084 | $79,423 |
| Surplus/Deficit | $79,084 | $4,339 | $7,579 |
| Total Capital | $120,084 | $124,423 | $132,002 |
| Total Liabilities and Capital | $128,564 | $136,297 | $144,103 |
| Net Worth | $120,084 | $124,423 | $132,002 |
8.6 Standard Ratios
The following table presents standard ratios. Transitional Housing has a Standard Industrial Classification (SIC) code: 8322.0304 – Emergency Shelters. Industry profile ratios are shown for comparison.
| Ratio Analysis | ||||
| Year 1 | Year 2 | Year 3 | Industry Profile | |
| Funding Growth | 0.00% | -2.96% | 4.07% | 7.72% |
| Percent of Total Assets | ||||
| Other Current Assets | 17.89% | 16.87% | 15.96% | 32.31% |
| Total Current Assets | 103.57% | 106.74% | 109.57% | 56.30% |
| Long-term Assets | -3.57% | -6.74% | -9.57% | 43.70% |
| Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
| Current Liabilities | 6.60% | 8.71% | 8.40% | 23.57% |
| Long-term Liabilities | 0.00% | 0.00% | 0.00% | 28.65% |
| Total Liabilities | 6.60% | 8.71% | 8.40% | 52.22% |
| Net Worth | 93.40% | 91.29% | 91.60% | 47.78% |
| Percent of Funding | ||||
| Funding | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Surplus | 85.69% | 85.89% | 85.84% | 100.00% |
| Selling, General & Administrative Expenses | #NAME? | 84.42% | 83.37% | 78.74% |
| Advertising Expenses | 0.00% | 0.00% | 0.00% | 0.97% |
| Surplus Before Interest and Taxes | 26.01% | 1.47% | 2.47% | 1.90% |
| Main Ratios | ||||
| Current | 15.70 | 12.25 | 13.05 | 2.18 |
| Quick | 15.70 | 12.25 | 13.05 | 1.77 |
| Total Debt to Total Assets | 6.60% | 8.71% | 8.40% | 3.01% |
| Pre-tax Return on Net Worth | 65.86% | 3.49% | 5.74% | 58.63% |
| Pre-tax Return on Assets | 61.51% | 3.18% | 5.26% | 7.27% |
| Additional Ratios | Year 1 | Year 2 | Year 3 | |
| Net Surplus Margin | 26.01% | 1.47% | 2.47% | n.a |
| Return on Equity | 65.86% | 3.49% | 5.74% | n.a |
| Activity Ratios | ||||
| Accounts Payable Turnover | 16.22 | 12.17 | 12.17 | n.a |
| Payment Days | 27 | 26 | 30 | n.a |
| Total Asset Turnover | 2.36 | 2.16 | 2.13 | n.a |
| Debt Ratios | ||||
| Debt to Net Worth | 0.07 | 0.10 | 0.09 | n.a |
| Current Liab. to Liab. | 1.00 | 1.00 | 1.00 | n.a |
| Liquidity Ratios | ||||
| Net Working Capital | $124,680 | $133,615 | $145,790 | n.a |
| Interest Coverage | 0.00 | 0.00 | 0.00 | n.a |
| Additional Ratios | ||||
| Assets to Funding | 0.42 | 0.46 | 0.47 | n.a |
| Current Debt/Total Assets | 7% | 9% | 8% | n.a |
| Acid Test | 15.70 | 12.25 | 13.05 | n.a |
| Funding/Net Worth | 2.53 | 2.37 | 2.33 | n.a |
| Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |
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