Our biggest savings of the year
Laser Tag
Financial Plan
The premier element in our financial plan is initiating, maintaining, and improving the factors that create, stabilize, and increase our cash flow:
- We must create visibility so as to create customer flow.
- We must ensure the theme creates a “WOW” effect to bolster attendance.
- We must maintain a dependable, cheerful employee force so as to minimize turnover.
9.1 Start-up Funding
Total start-up requirements come to $111,844. The start-up costs are to be financed partially by the direct owner investment of $27,000 and financing in the amount of $84,844. The details are included in the following table.
Start-up Funding | |
Start-up Expenses to Fund | $50,097 |
Start-up Assets to Fund | $61,747 |
Total Funding Required | $111,844 |
Assets | |
Non-cash Assets from Start-up | $51,747 |
Cash Requirements from Start-up | $10,000 |
Additional Cash Raised | $0 |
Cash Balance on Starting Date | $10,000 |
Total Assets | $61,747 |
Liabilities and Capital | |
Liabilities | |
Current Borrowing | $0 |
Long-term Liabilities | $84,844 |
Accounts Payable (Outstanding Bills) | $0 |
Other Current Liabilities (interest-free) | $0 |
Total Liabilities | $84,844 |
Capital | |
Planned Investment | |
Owner | $27,000 |
Investor | $0 |
Additional Investment Requirement | $0 |
Total Planned Investment | $27,000 |
Loss at Start-up (Start-up Expenses) | ($50,097) |
Total Capital | ($23,097) |
Total Capital and Liabilities | $61,747 |
Total Funding | $111,844 |
9.2 Important Assumptions
The key underlying assumptions of our financial plan shown in the following general assumption table are:
- We assume access to equity capital and financing to support our financial plan.
- We assume our financial progress based on realistic sales to minimum sales against highest expenses.
- We assume there will not be an economic crash that would greatly hinder our target market’s access to their personal luxury finds.
General Assumptions | |||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
Plan Month | 1 | 2 | 3 | 4 | 5 |
Current Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% |
Long-term Interest Rate | 11.00% | 11.00% | 11.00% | 11.00% | 11.00% |
Tax Rate | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% |
Other | 0 | 0 | 0 | 0 | 0 |
9.3 Break-even Analysis
Our break-even analysis is shown below.

Break-even Analysis | |
Monthly Units Break-even | 9,876 |
Monthly Revenue Break-even | $22,551 |
Assumptions: | |
Average Per-Unit Revenue | $2.28 |
Average Per-Unit Variable Cost | $0.33 |
Estimated Monthly Fixed Cost | $19,324 |
9.4 Projected Profit and Loss
The company will make a profit early on. There are two important assumptions with our Projected Profit and Loss statement:
- Our revenue is based on minimum estimated averages against highest expense expectations.
- Our major expense of rent and utilities is fixed for the next five years.
The yearly analysis is indicated in the table below; monthly analyses can be found in the appendix.




Pro Forma Profit and Loss | |||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
Sales | $427,422 | $398,023 | $383,829 | $407,177 | $432,517 |
Direct Cost of Sales | $61,165 | $61,172 | $60,820 | $64,281 | $67,990 |
Other Costs of Sales | $0 | $0 | $0 | $0 | $0 |
Total Cost of Sales | $61,165 | $61,172 | $60,820 | $64,281 | $67,990 |
Gross Margin | $366,256 | $336,850 | $323,008 | $342,896 | $364,527 |
Gross Margin % | 85.69% | 84.63% | 84.15% | 84.21% | 84.28% |
Expenses | |||||
Payroll | $75,971 | $77,969 | $83,689 | $91,648 | $99,706 |
Marketing/Promotion | $60,000 | $62,000 | $63,000 | $65,000 | $66,000 |
Depreciation | $5,875 | $5,875 | $5,875 | $5,875 | $5,875 |
Rent | $57,600 | $57,600 | $57,600 | $57,600 | $57,600 |
Utilities | $7,340 | $8,000 | $8,200 | $8,400 | $8,600 |
Insurance | $10,944 | $10,944 | $10,944 | $10,944 | $10,944 |
Professional Fees | $2,400 | $2,400 | $2,400 | $2,400 | $2,400 |
Telephone | $2,040 | $2,100 | $2,150 | $2,200 | $2,250 |
Supplies | $4,800 | $4,800 | $4,800 | $4,800 | $4,800 |
Bank & Credit Card Fees | $1,320 | $1,320 | $1,320 | $1,320 | $1,320 |
New Game Software | $0 | $10,000 | $15,000 | $10,000 | $0 |
Miscellaneous | $3,600 | $3,600 | $3,600 | $3,600 | $3,600 |
Total Operating Expenses | $231,890 | $246,608 | $258,578 | $263,787 | $263,095 |
Profit Before Interest and Taxes | $134,366 | $90,242 | $64,430 | $79,108 | $101,432 |
EBITDA | $140,241 | $96,117 | $70,305 | $84,983 | $107,307 |
Interest Expense | $8,611 | $7,333 | $6,000 | $4,667 | $3,333 |
Taxes Incurred | $37,726 | $24,873 | $17,529 | $22,333 | $29,430 |
Net Profit | $88,028 | $58,037 | $40,901 | $52,109 | $68,669 |
Net Profit/Sales | 20.60% | 14.58% | 10.66% | 12.80% | 15.88% |
9.5 Projected Cash Flow
The company’s estimated cash flow analysis is outlined in the following table. Laser Tag’s popularity will instantly show profitability, which will ensure positive cash balance. The Cash Flow table also shows planned sales tax received and paid out, and the estimated repayment for the requested loan.

Pro Forma Cash Flow | |||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
Cash Received | |||||
Cash from Operations | |||||
Cash Sales | $320,566 | $298,517 | $287,871 | $305,382 | $324,388 |
Cash from Receivables | $96,929 | $100,188 | $96,287 | $101,252 | $107,541 |
Subtotal Cash from Operations | $417,495 | $398,705 | $384,158 | $406,634 | $431,929 |
Additional Cash Received | |||||
Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 | $0 | $0 |
New Current Borrowing | $0 | $0 | $0 | $0 | $0 |
New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 |
New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 |
Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 |
Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 |
New Investment Received | $0 | $0 | $0 | $0 | $0 |
Subtotal Cash Received | $417,495 | $398,705 | $384,158 | $406,634 | $431,929 |
Expenditures | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
Expenditures from Operations | |||||
Cash Spending | $75,971 | $77,969 | $83,689 | $91,648 | $99,706 |
Bill Payments | $237,732 | $257,787 | $253,576 | $257,359 | $258,396 |
Subtotal Spent on Operations | $313,703 | $335,756 | $337,265 | $349,007 | $358,102 |
Additional Cash Spent | |||||
Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 |
Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 |
Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 |
Long-term Liabilities Principal Repayment | $12,120 | $12,120 | $12,120 | $12,120 | $12,120 |
Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 | $0 | $0 |
Subtotal Cash Spent | $325,823 | $347,876 | $349,385 | $361,127 | $370,222 |
Net Cash Flow | $91,672 | $50,829 | $34,773 | $45,507 | $61,707 |
Cash Balance | $101,672 | $152,501 | $187,274 | $232,781 | $294,487 |
9.6 Projected Balance Sheet
The table below presents the balance sheet for Laser Tag. This table reflects a positive cash position throughout the period of this financial plan and dramatic growth in net worth.
Pro Forma Balance Sheet | |||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
Assets | |||||
Current Assets | |||||
Cash | $101,672 | $152,501 | $187,274 | $232,781 | $294,487 |
Accounts Receivable | $9,926 | $9,244 | $8,914 | $9,456 | $10,045 |
Inventory | $2,883 | $2,883 | $2,867 | $3,041 | $3,230 |
Other Current Assets | $4,480 | $4,480 | $4,480 | $4,480 | $4,480 |
Total Current Assets | $118,961 | $169,108 | $203,534 | $249,758 | $312,243 |
Long-term Assets | |||||
Long-term Assets | $47,267 | $47,267 | $47,267 | $47,267 | $47,267 |
Accumulated Depreciation | $5,875 | $11,750 | $17,625 | $23,500 | $29,375 |
Total Long-term Assets | $41,392 | $35,517 | $29,642 | $23,767 | $17,892 |
Total Assets | $160,353 | $204,625 | $233,176 | $273,525 | $330,134 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
Current Liabilities | |||||
Accounts Payable | $22,698 | $21,053 | $20,823 | $21,182 | $21,243 |
Current Borrowing | $0 | $0 | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 | $0 | $0 |
Subtotal Current Liabilities | $22,698 | $21,053 | $20,823 | $21,182 | $21,243 |
Long-term Liabilities | $72,724 | $60,604 | $48,484 | $36,364 | $24,244 |
Total Liabilities | $95,422 | $81,657 | $69,307 | $57,546 | $45,487 |
Paid-in Capital | $27,000 | $27,000 | $27,000 | $27,000 | $27,000 |
Retained Earnings | ($50,097) | $37,931 | $95,968 | $136,869 | $188,978 |
Earnings | $88,028 | $58,037 | $40,901 | $52,109 | $68,669 |
Total Capital | $64,931 | $122,968 | $163,869 | $215,978 | $284,647 |
Total Liabilities and Capital | $160,353 | $204,625 | $233,176 | $273,525 | $330,134 |
Net Worth | $64,931 | $122,968 | $163,869 | $215,978 | $284,647 |
9.7 Business Ratios
The company’s projected business ratios are provided in the table below. The final column, Industry Profile, shows significant ratios for the Amusement and Recreation industry for comparison, as determined by the Standard Industry Classification (SIC) code, 7999.
Ratio Analysis | ||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Industry Profile | |
Sales Growth | 0.00% | -6.88% | -3.57% | 6.08% | 6.22% | 2.76% |
Percent of Total Assets | ||||||
Accounts Receivable | 6.19% | 4.52% | 3.82% | 3.46% | 3.04% | 4.27% |
Inventory | 1.80% | 1.41% | 1.23% | 1.11% | 0.98% | 4.31% |
Other Current Assets | 2.79% | 2.19% | 1.92% | 1.64% | 1.36% | 31.38% |
Total Current Assets | 74.19% | 82.64% | 87.29% | 91.31% | 94.58% | 39.96% |
Long-term Assets | 25.81% | 17.36% | 12.71% | 8.69% | 5.42% | 60.04% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 14.15% | 10.29% | 8.93% | 7.74% | 6.43% | 23.98% |
Long-term Liabilities | 45.35% | 29.62% | 20.79% | 13.29% | 7.34% | 24.53% |
Total Liabilities | 59.51% | 39.91% | 29.72% | 21.04% | 13.78% | 48.51% |
Net Worth | 40.49% | 60.09% | 70.28% | 78.96% | 86.22% | 51.49% |
Percent of Sales | ||||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 85.69% | 84.63% | 84.15% | 84.21% | 84.28% | 100.00% |
Selling, General & Administrative Expenses | 65.09% | 70.05% | 73.50% | 71.42% | 68.40% | 75.54% |
Advertising Expenses | 1.37% | 0.00% | 0.00% | 0.00% | 0.00% | 3.11% |
Profit Before Interest and Taxes | 31.44% | 22.67% | 16.79% | 19.43% | 23.45% | 1.52% |
Main Ratios | ||||||
Current | 5.24 | 8.03 | 9.77 | 11.79 | 14.70 | 1.04 |
Quick | 5.11 | 7.90 | 9.64 | 11.65 | 14.55 | 0.68 |
Total Debt to Total Assets | 59.51% | 39.91% | 29.72% | 21.04% | 13.78% | 64.79% |
Pre-tax Return on Net Worth | 193.67% | 67.42% | 35.66% | 34.47% | 34.46% | 2.30% |
Pre-tax Return on Assets | 78.42% | 40.52% | 25.06% | 27.22% | 29.71% | 6.54% |
Additional Ratios | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
Net Profit Margin | 20.60% | 14.58% | 10.66% | 12.80% | 15.88% | n.a |
Return on Equity | 135.57% | 47.20% | 24.96% | 24.13% | 24.12% | n.a |
Activity Ratios | ||||||
Accounts Receivable Turnover | 10.76 | 10.76 | 10.76 | 10.76 | 10.76 | n.a |
Collection Days | 29 | 35 | 35 | 33 | 33 | n.a |
Inventory Turnover | 24.00 | 21.22 | 21.16 | 21.76 | 21.68 | n.a |
Accounts Payable Turnover | 11.47 | 12.17 | 12.17 | 12.17 | 12.17 | n.a |
Payment Days | 27 | 31 | 30 | 30 | 30 | n.a |
Total Asset Turnover | 2.67 | 1.95 | 1.65 | 1.49 | 1.31 | n.a |
Debt Ratios | ||||||
Debt to Net Worth | 1.47 | 0.66 | 0.42 | 0.27 | 0.16 | n.a |
Current Liab. to Liab. | 0.24 | 0.26 | 0.30 | 0.37 | 0.47 | n.a |
Liquidity Ratios | ||||||
Net Working Capital | $96,263 | $148,055 | $182,711 | $228,576 | $291,000 | n.a |
Interest Coverage | 15.60 | 12.31 | 10.74 | 16.95 | 30.43 | n.a |
Additional Ratios | ||||||
Assets to Sales | 0.38 | 0.51 | 0.61 | 0.67 | 0.76 | n.a |
Current Debt/Total Assets | 14% | 10% | 9% | 8% | 6% | n.a |
Acid Test | 4.68 | 7.46 | 9.21 | 11.20 | 14.07 | n.a |
Sales/Net Worth | 6.58 | 3.24 | 2.34 | 1.89 | 1.52 | n.a |
Dividend Payout | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | n.a |