Park Square Family Medicine
Financial Plan
Forecast
Key Assumptions
Important notation/limitations in viewing the financial plan:
- The physician salary is considered a constant in the first year and therefore has not been included in this overall financial plan.
- The $32,732 in start-up subsidies, and the $288,000 in first-year subsidies is forgiven and not subject to reimbursement unless Park Square family medicine fails…which will not happen. "Failure" is defined in the grant agreement as inability to achieve patient load goals for five months in a row during the first year.
Revenue by Month
Expenses by Month
Net Profit (or Loss) by Year
Financing
Use of Funds
we will purchase the building and have the following startup expenses
Legal & Accounting $500
Insurance $1,000
Marketing $2,000
Computer $3,000
Business License $32
Communications $150
Medical Equipment $7,000
Office Supplies $4,000
Office Furniture $2,000
Marketing Plan $3,000
Regulatory Duties/CLIA $50
TOTAL START-UP EXPENSES $22,732
Sources of Funds
The start-up requirements, with the exception of the building loan, are to be financed by General Medical Center. This is in addition to the $288,000 they will be providing will help with expenses in the first year. As well as $24000 for the physician’s expenses for the first year
The purchase of the building will be financed by the owner, Dr. Detroit, with a 15-year mortgage (listed under Long-term Liabilities). This loan will be repaid from the clinic’s cash flows and guaranteed with his personal assets.
Statements
Projected Profit & Loss
| 2020 | 2021 | 2022 | |
|---|---|---|---|
| Revenue | $262,500 | $333,000 | $407,000 |
| Direct Costs | $5,250 | $6,660 | $8,140 |
| Gross Margin | $257,250 | $326,340 | $398,860 |
| Gross Margin % | 98% | 98% | 98% |
| Operating Expenses | |||
| Salaries & Wages | $81,600 | $153,232 | $194,896 |
| Employee Related Expenses | $16,320 | $30,646 | $38,980 |
| Health Insurance | $2,004 | $2,004 | $2,004 |
| Dental Insurance | $2,004 | $2,004 | $2,004 |
| Vision Insurance | $2,004 | $2,004 | $2,004 |
| Workman’s Comp | $1,800 | $1,800 | $1,800 |
| Promotion | $8,640 | $8,640 | $8,640 |
| Marketing | $6,000 | $6,000 | $6,000 |
| Printing | $2,004 | $2,004 | $2,004 |
| Professional Services | $996 | $996 | $996 |
| Answering Services | $2,400 | $2,400 | $2,400 |
| Telephone | $1,560 | $1,560 | $1,560 |
| Medical Waste | $2,004 | $2,004 | $2,004 |
| Repairs and Maintenance | $1,500 | $1,500 | $1,500 |
| Janitorial Service | $1,560 | $1,560 | $1,560 |
| Dues and Subscriptions | $1,008 | $1,008 | $1,008 |
| Medical Billing | $19,200 | $19,200 | $19,200 |
| Total Operating Expenses | $152,604 | $238,562 | $288,560 |
| Operating Income | $104,646 | $87,778 | $110,300 |
| Interest Incurred | $12,626 | $10,645 | $8,542 |
| Depreciation and Amortization | $15,000 | $15,000 | $15,000 |
| Gain or Loss from Sale of Assets | |||
| Income Taxes | $0 | $0 | $0 |
| Total Expenses | $185,480 | $270,868 | $320,240 |
| Net Profit | $77,020 | $62,132 | $86,760 |
| Net Profit/Sales | 29% | 19% | 21% |
Projected Balance Sheet
| Starting Balances | 2020 | 2021 | 2022 | |
|---|---|---|---|---|
| Cash | $16,000 | $75,898 | $118,928 | $184,480 |
| Accounts Receivable | $0 | $0 | $0 | |
| Inventory | ||||
| Other Current Assets | ||||
| Total Current Assets | $16,000 | $75,898 | $118,928 | $184,480 |
| Long-Term Assets | $225,000 | $225,000 | $225,000 | $225,000 |
| Accumulated Depreciation | ($15,000) | ($30,000) | ($45,000) | |
| Total Long-Term Assets | $225,000 | $210,000 | $195,000 | $180,000 |
| Total Assets | $241,000 | $285,898 | $313,928 | $364,480 |
| Accounts Payable | $0 | $0 | $0 | |
| Income Taxes Payable | $0 | $0 | $0 | |
| Sales Taxes Payable | $0 | $0 | $0 | |
| Short-Term Debt | $32,122 | $34,103 | $36,206 | $38,440 |
| Prepaid Revenue | ||||
| Total Current Liabilities | $32,122 | $34,103 | $36,206 | $38,440 |
| Long-Term Debt | $192,878 | $158,775 | $122,569 | $84,129 |
| Long-Term Liabilities | $192,878 | $158,775 | $122,569 | $84,129 |
| Total Liabilities | $225,000 | $192,878 | $158,775 | $122,569 |
| Paid-In Capital | $38,732 | $38,732 | $38,732 | $38,732 |
| Retained Earnings | ($22,732) | ($22,732) | $54,288 | $116,420 |
| Earnings | $77,020 | $62,133 | $86,759 | |
| Total Owner’s Equity | $16,000 | $93,020 | $155,152 | $241,912 |
| Total Liabilities & Equity | $241,000 | $285,898 | $313,928 | $364,480 |
Projected Cash Flow Statement
| 2020 | 2021 | 2022 | |
|---|---|---|---|
| Net Cash Flow from Operations | |||
| Net Profit | $77,020 | $62,132 | $86,760 |
| Depreciation & Amortization | $15,000 | $15,000 | $15,000 |
| Change in Accounts Receivable | $0 | $0 | $0 |
| Change in Inventory | |||
| Change in Accounts Payable | $0 | $0 | $0 |
| Change in Income Tax Payable | $0 | $0 | $0 |
| Change in Sales Tax Payable | $0 | $0 | $0 |
| Change in Prepaid Revenue | |||
| Net Cash Flow from Operations | $92,020 | $77,133 | $101,759 |
| Investing & Financing | |||
| Assets Purchased or Sold | |||
| Net Cash from Investing | |||
| Investments Received | |||
| Dividends & Distributions | |||
| Change in Short-Term Debt | $1,981 | $2,103 | $2,233 |
| Change in Long-Term Debt | ($34,103) | ($36,206) | ($38,440) |
| Net Cash from Financing | ($32,122) | ($34,103) | ($36,206) |
| Cash at Beginning of Period | $16,000 | $75,898 | $118,928 |
| Net Change in Cash | $59,898 | $43,030 | $65,553 |
| Cash at End of Period | $75,898 | $118,928 | $184,480 |
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