Royal's Software
Appendix
| Sales Forecast | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Sales | |||||||||||||
| MAS-90 | 0% | $0 | $0 | $12,000 | $15,000 | $18,000 | $20,000 | $20,000 | $22,000 | $24,000 | $20,000 | $21,000 | $22,000 |
| Royal’s Inventory Basic | 0% | $0 | $0 | $12,000 | $15,000 | $18,000 | $21,000 | $20,000 | $21,000 | $20,000 | $15,000 | $17,000 | $20,000 |
| Custom Consultation/Adptation | 0% | $0 | $0 | $6,000 | $9,000 | $12,000 | $18,000 | $20,000 | $18,000 | $14,000 | $18,000 | $17,000 | $19,000 |
| Total Sales | $0 | $0 | $30,000 | $39,000 | $48,000 | $59,000 | $60,000 | $61,000 | $58,000 | $53,000 | $55,000 | $61,000 | |
| Direct Cost of Sales | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
| MAS-90 | $0 | $0 | $360 | $450 | $540 | $600 | $600 | $660 | $720 | $600 | $630 | $660 | |
| Royal’s Inventory Basic | $0 | $0 | $360 | $450 | $540 | $630 | $600 | $630 | $600 | $450 | $510 | $600 | |
| Custom Consultation/Adptation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Subtotal Direct Cost of Sales | $0 | $0 | $720 | $900 | $1,080 | $1,230 | $1,200 | $1,290 | $1,320 | $1,050 | $1,140 | $1,260 | |
| Personnel Plan | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| CEO | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| John Royal | 0% | $5,000 | $5,000 | $7,500 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $7,500 | $5,000 | $5,000 |
| Dan Whiteaker | 0% | $5,000 | $5,000 | $7,500 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $7,500 | $5,000 | $5,000 |
| Application Engineer | 0% | $4,615 | $4,615 | $6,922 | $4,615 | $4,615 | $4,615 | $4,615 | $4,617 | $4,616 | $6,924 | $4,616 | $4,615 |
| Support Engineer | 0% | $3,842 | $3,842 | $5,769 | $3,848 | $3,850 | $3,842 | $3,842 | $3,850 | $3,850 | $5,769 | $3,850 | $3,846 |
| Tech Support Staff | 0% | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 | $2,500 |
| Total People | 6 | 6 | 6 | 6 | 6 | 6 | 6 | 6 | 6 | 6 | 6 | 6 | |
| Total Payroll | $20,957 | $20,957 | $30,191 | $20,963 | $20,965 | $20,957 | $20,957 | $20,967 | $20,966 | $30,193 | $20,966 | $20,961 | |
| General Assumptions | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Plan Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |
| Current Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
| Long-term Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
| Tax Rate | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | |
| Other | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| Pro Forma Profit and Loss | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Sales | $0 | $0 | $30,000 | $39,000 | $48,000 | $59,000 | $60,000 | $61,000 | $58,000 | $53,000 | $55,000 | $61,000 | |
| Direct Cost of Sales | $0 | $0 | $720 | $900 | $1,080 | $1,230 | $1,200 | $1,290 | $1,320 | $1,050 | $1,140 | $1,260 | |
| Other Production Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Total Cost of Sales | $0 | $0 | $720 | $900 | $1,080 | $1,230 | $1,200 | $1,290 | $1,320 | $1,050 | $1,140 | $1,260 | |
| Gross Margin | $0 | $0 | $29,280 | $38,100 | $46,920 | $57,770 | $58,800 | $59,710 | $56,680 | $51,950 | $53,860 | $59,740 | |
| Gross Margin % | 0.00% | 0.00% | 97.60% | 97.69% | 97.75% | 97.92% | 98.00% | 97.89% | 97.72% | 98.02% | 97.93% | 97.93% | |
| Expenses | |||||||||||||
| Payroll | $20,957 | $20,957 | $30,191 | $20,963 | $20,965 | $20,957 | $20,957 | $20,967 | $20,966 | $30,193 | $20,966 | $20,961 | |
| Sales and Marketing and Other Expenses | $0 | $0 | $6,000 | $6,900 | $8,300 | $9,800 | $10,000 | $10,200 | $9,600 | $12,200 | $13,400 | $15,200 | |
| Depreciation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Leased Equipment | $5,000 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Utilities | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | $400 | |
| Insurance | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
| Rent | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | $1,000 | |
| Payroll Taxes | 15% | $3,144 | $3,144 | $4,529 | $3,144 | $3,145 | $3,144 | $3,144 | $3,145 | $3,145 | $4,529 | $3,145 | $3,144 |
| Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Total Operating Expenses | $30,701 | $25,701 | $42,320 | $32,607 | $34,010 | $35,501 | $35,701 | $35,912 | $35,311 | $48,522 | $39,111 | $40,905 | |
| Profit Before Interest and Taxes | ($30,701) | ($25,701) | ($13,040) | $5,493 | $12,910 | $22,269 | $23,099 | $23,798 | $21,369 | $3,428 | $14,749 | $18,835 | |
| EBITDA | ($30,701) | ($25,701) | ($13,040) | $5,493 | $12,910 | $22,269 | $23,099 | $23,798 | $21,369 | $3,428 | $14,749 | $18,835 | |
| Interest Expense | $819 | $806 | $792 | $778 | $764 | $750 | $736 | $722 | $708 | $695 | $681 | $667 | |
| Taxes Incurred | ($9,456) | ($7,952) | ($4,149) | $1,414 | $3,644 | $6,456 | $6,709 | $6,923 | $6,198 | $820 | $4,221 | $5,450 | |
| Net Profit | ($22,064) | ($18,554) | ($9,682) | $3,300 | $8,502 | $15,064 | $15,654 | $16,153 | $14,463 | $1,913 | $9,848 | $12,718 | |
| Net Profit/Sales | 0.00% | 0.00% | -32.27% | 8.46% | 17.71% | 25.53% | 26.09% | 26.48% | 24.94% | 3.61% | 17.91% | 20.85% | |
| Pro Forma Cash Flow | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Cash Received | |||||||||||||
| Cash from Operations | |||||||||||||
| Cash Sales | $0 | $0 | $7,500 | $9,750 | $12,000 | $14,750 | $15,000 | $15,250 | $14,500 | $13,250 | $13,750 | $15,250 | |
| Cash from Receivables | $0 | $0 | $0 | $750 | $22,725 | $29,475 | $36,275 | $44,275 | $45,025 | $45,675 | $43,375 | $39,800 | |
| Subtotal Cash from Operations | $0 | $0 | $7,500 | $10,500 | $34,725 | $44,225 | $51,275 | $59,525 | $59,525 | $58,925 | $57,125 | $55,050 | |
| Additional Cash Received | |||||||||||||
| Sales Tax, VAT, HST/GST Received | 0.00% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| New Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| New Investment Received | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Subtotal Cash Received | $0 | $0 | $7,500 | $10,500 | $34,725 | $44,225 | $51,275 | $59,525 | $59,525 | $58,925 | $57,125 | $55,050 | |
| Expenditures | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
| Expenditures from Operations | |||||||||||||
| Cash Spending | $20,957 | $20,957 | $30,191 | $20,963 | $20,965 | $20,957 | $20,957 | $20,967 | $20,966 | $30,193 | $20,966 | $20,961 | |
| Bill Payments | $37 | ($1,333) | ($2,006) | $9,666 | $14,863 | $18,681 | $22,993 | $23,405 | $23,836 | $22,516 | $21,003 | $24,291 | |
| Subtotal Spent on Operations | $20,994 | $19,624 | $28,185 | $30,629 | $35,828 | $39,638 | $43,950 | $44,372 | $44,802 | $52,709 | $41,969 | $45,252 | |
| Additional Cash Spent | |||||||||||||
| Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Long-term Liabilities Principal Repayment | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | $1,666 | |
| Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Subtotal Cash Spent | $22,660 | $21,290 | $29,851 | $32,295 | $37,494 | $41,304 | $45,616 | $46,038 | $46,468 | $54,375 | $43,635 | $46,918 | |
| Net Cash Flow | ($22,660) | ($21,290) | ($22,351) | ($21,795) | ($2,769) | $2,921 | $5,659 | $13,487 | $13,057 | $4,550 | $13,490 | $8,132 | |
| Cash Balance | $151,840 | $130,550 | $108,199 | $86,404 | $83,635 | $86,556 | $92,215 | $105,702 | $118,759 | $123,309 | $136,799 | $144,931 | |
| Pro Forma Balance Sheet | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Assets | Starting Balances | ||||||||||||
| Current Assets | |||||||||||||
| Cash | $174,500 | $151,840 | $130,550 | $108,199 | $86,404 | $83,635 | $86,556 | $92,215 | $105,702 | $118,759 | $123,309 | $136,799 | $144,931 |
| Accounts Receivable | $0 | $0 | $0 | $22,500 | $51,000 | $64,275 | $79,050 | $87,775 | $89,250 | $87,725 | $81,800 | $79,675 | $85,625 |
| Other Current Assets | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 |
| Total Current Assets | $184,500 | $161,840 | $140,550 | $140,699 | $147,404 | $157,910 | $175,606 | $189,990 | $204,952 | $216,484 | $215,109 | $226,474 | $240,556 |
| Long-term Assets | |||||||||||||
| Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Accumulated Depreciation | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Total Long-term Assets | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Total Assets | $184,500 | $161,840 | $140,550 | $140,699 | $147,404 | $157,910 | $175,606 | $189,990 | $204,952 | $216,484 | $215,109 | $226,474 | $240,556 |
| Liabilities and Capital | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
| Current Liabilities | |||||||||||||
| Accounts Payable | $0 | $1,070 | $0 | $11,497 | $16,568 | $20,237 | $24,536 | $24,932 | $25,407 | $24,142 | $22,520 | $25,702 | $28,733 |
| Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Subtotal Current Liabilities | $0 | $1,070 | $0 | $11,497 | $16,568 | $20,237 | $24,536 | $24,932 | $25,407 | $24,142 | $22,520 | $25,702 | $28,733 |
| Long-term Liabilities | $100,000 | $98,334 | $96,668 | $95,002 | $93,336 | $91,670 | $90,004 | $88,338 | $86,672 | $85,006 | $83,340 | $81,674 | $80,008 |
| Total Liabilities | $100,000 | $99,404 | $96,668 | $106,499 | $109,904 | $111,907 | $114,540 | $113,270 | $112,079 | $109,148 | $105,860 | $107,376 | $108,741 |
| Paid-in Capital | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 |
| Retained Earnings | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) | ($115,500) |
| Earnings | $0 | ($22,064) | ($40,618) | ($50,300) | ($47,000) | ($38,497) | ($23,434) | ($7,780) | $8,373 | $22,836 | $24,749 | $34,597 | $47,315 |
| Total Capital | $84,500 | $62,436 | $43,882 | $34,200 | $37,500 | $46,003 | $61,066 | $76,720 | $92,873 | $107,336 | $109,249 | $119,097 | $131,815 |
| Total Liabilities and Capital | $184,500 | $161,840 | $140,550 | $140,699 | $147,404 | $157,910 | $175,606 | $189,990 | $204,952 | $216,484 | $215,109 | $226,474 | $240,556 |
| Net Worth | $84,500 | $62,436 | $43,882 | $34,200 | $37,500 | $46,003 | $61,066 | $76,720 | $92,873 | $107,336 | $109,249 | $119,097 | $131,815 |
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