MSN Real Estate
Financial Plan
Forecast
Key assumptions
MSN’s plan depends on the assumptions that are made in the following table. These are annual and monthly assumptions that show the consistent growth of the company. Since we operate on a monthly collection basis, we are assuming that the majority of the collections will be timely and in full.
Some of the underlying assumptions are:
- We assume a healthy growth trend in the local real estate market, along with a continued strong local economy.
- We assume that we stay in line with the continuing advances in technology and housing.
Revenue by Month
Expenses by Month
Net Profit (or Loss) by Year
Financing
Use of funds
The total start-up expenses include legal, stationery, architect, brochures, consultants, insurance, rent, construction, expensed equipment, etc. Start-up assets required include short-term assets (truck, cell phone, etc.), and initial cash to handle the architect and contractor fees prior to opening. Additional cash is needed to pay all zoning fees and governmental regulations.
Long-term asset purchases and the assumption of long-term liabilities are anticipated.
Start-up Expenses
Legal $6,400
Architect Fees $3,000
Stationery etc. $270
Brochures $275
Consultants $2,550
Insurance $1,315
Rent $1,400
Construction $75,000
Expensed Equipment $600
Other $750
TOTAL START-UP EXPENSES $91,000
Sources of Funds
We are getting startup funding from a couple of sources:
An angel investment firm will give us $1,000,000. They believe its a good investment due to our company assets
Long term liabilities – 200,0000
Menashe – 25,000
Koach – 25,000
Totaling $1,250,000
Statements
Projected Profit and Loss
| 2018 | 2019 | 2020 | |
|---|---|---|---|
| Revenue | $891,900 | $1,246,200 | $1,429,100 |
| Direct Costs | $79,330 | $111,020 | $119,790 |
| Gross Margin | $812,570 | $1,135,180 | $1,309,310 |
| Gross Margin % | 91% | 91% | 92% |
| Operating Expenses | |||
| Salaries & Wages | $249,600 | $254,592 | $259,683 |
| Employee Related Expenses | $49,920 | $50,918 | $51,937 |
| Leased Equipment | $24,000 | $24,000 | $24,000 |
| Utilities | $21,600 | $21,600 | $21,600 |
| Rent | $43,200 | $43,200 | $43,200 |
| Insurance | $18,000 | $18,000 | $18,000 |
| Amortization of Other Current Assets | $0 | $0 | $0 |
| Total Operating Expenses | $406,320 | $412,310 | $418,420 |
| Operating Income | $406,250 | $722,870 | $890,890 |
| Interest Incurred | $13,805 | $11,638 | $9,339 |
| Depreciation and Amortization | $40,000 | $40,000 | $40,000 |
| Gain or Loss from Sale of Assets | |||
| Income Taxes | $0 | $0 | $0 |
| Total Expenses | $539,455 | $574,969 | $587,548 |
| Net Profit | $352,445 | $671,231 | $841,552 |
| Net Profit/Sales | 40% | 54% | 59% |
Projected Balance Sheet
| Starting Balances | 2018 | 2019 | 2020 | |
|---|---|---|---|---|
| Cash | $44,000 | $401,326 | $1,075,272 | $1,917,238 |
| Accounts Receivable | $0 | $0 | $0 | |
| Inventory | ||||
| Other Current Assets | $12,000 | $12,000 | $12,000 | $12,000 |
| Total Current Assets | $56,000 | $413,326 | $1,087,272 | $1,929,238 |
| Long-Term Assets | $1,200,000 | $1,200,000 | $1,200,000 | $1,200,000 |
| Accumulated Depreciation | ($40,000) | ($80,000) | ($120,000) | |
| Total Long-Term Assets | $1,200,000 | $1,160,000 | $1,120,000 | $1,080,000 |
| Total Assets | $1,256,000 | $1,573,326 | $2,207,272 | $3,009,238 |
| Accounts Payable | $0 | $0 | $0 | |
| Income Taxes Payable | $0 | $0 | $0 | |
| Sales Taxes Payable | $0 | $0 | $0 | |
| Short-Term Debt | $35,119 | $37,285 | $39,585 | $42,027 |
| Prepaid Revenue | ||||
| Total Current Liabilities | $35,119 | $37,285 | $39,585 | $42,027 |
| Long-Term Debt | $210,881 | $173,595 | $134,010 | $91,983 |
| Long-Term Liabilities | $210,881 | $173,595 | $134,010 | $91,983 |
| Total Liabilities | $246,000 | $210,881 | $173,595 | $134,010 |
| Paid-In Capital | $1,100,000 | $1,100,000 | $1,100,000 | $1,100,000 |
| Retained Earnings | ($90,000) | ($90,000) | $262,445 | $933,676 |
| Earnings | $352,445 | $671,231 | $841,552 | |
| Total Owner’s Equity | $1,010,000 | $1,362,445 | $2,033,676 | $2,875,228 |
| Total Liabilities & Equity | $1,256,000 | $1,573,326 | $2,207,272 | $3,009,238 |
Projected Cash Flow Statement
| 2018 | 2019 | 2020 | |
|---|---|---|---|
| Net Cash Flow from Operations | |||
| Net Profit | $352,445 | $671,231 | $841,552 |
| Depreciation & Amortization | $40,000 | $40,000 | $40,000 |
| 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 | $392,445 | $711,231 | $881,552 |
| Investing & Financing | |||
| Assets Purchased or Sold | |||
| Net Cash from Investing | |||
| Investments Received | |||
| Dividends & Distributions | |||
| Change in Short-Term Debt | $2,166 | $2,300 | $2,442 |
| Change in Long-Term Debt | ($37,285) | ($39,585) | ($42,027) |
| Net Cash from Financing | ($35,119) | ($37,285) | ($39,585) |
| Cash at Beginning of Period | $44,000 | $401,326 | $1,075,272 |
| Net Change in Cash | $357,326 | $673,946 | $841,966 |
| Cash at End of Period | $401,326 | $1,075,272 | $1,917,238 |
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