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Pita Pal

Financial Plan

The following sections will detail important financial information.

7.1 Important Assumptions

The following table will detail 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 30.00% 30.00% 30.00%
Other 0 0 0

7.2 Break-even Analysis

The following table and chart show our Break-even Analysis.

Sandwich restaurant business plan, financial plan chart image

Break-even Analysis
Monthly Revenue Break-even $9,799
Assumptions:
Average Percent Variable Cost 27%
Estimated Monthly Fixed Cost $7,149

7.3 Projected Profit and Loss

The following table and charts illustrate the Projected Profit and Loss.

Sandwich restaurant business plan, financial plan chart image

Sandwich restaurant business plan, financial plan chart image

Sandwich restaurant business plan, financial plan chart image

Sandwich restaurant business plan, financial plan chart image

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $68,673 $145,299 $203,676
Direct Cost of Sales $18,571 $39,292 $55,079
Other Costs of Goods $0 $0 $0
Total Cost of Sales $18,571 $39,292 $55,079
Gross Margin $50,102 $106,007 $148,598
Gross Margin % 72.96% 72.96% 72.96%
Expenses
Payroll $54,600 $70,200 $73,200
Sales and Marketing and Other Expenses $2,400 $2,400 $2,400
Depreciation $5,004 $5,004 $5,004
Rent $9,000 $9,000 $9,000
Utilities $3,600 $3,600 $3,600
Insurance $3,000 $3,000 $3,000
Payroll Taxes $8,190 $10,530 $10,980
Other $0 $0 $0
Total Operating Expenses $85,794 $103,734 $107,184
Profit Before Interest and Taxes ($35,691) $2,273 $41,414
EBITDA ($30,688) $7,277 $46,418
Interest Expense $0 $0 $0
Taxes Incurred $0 $682 $12,424
Net Profit ($35,691) $1,591 $28,990
Net Profit/Sales -51.97% 1.09% 14.23%

7.4 Projected Cash Flow

The following table and chart will indicate Projected Cash Flow.

Sandwich restaurant business plan, financial plan chart image

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $68,673 $145,299 $203,676
Subtotal Cash from Operations $68,673 $145,299 $203,676
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 $68,673 $145,299 $203,676
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $54,600 $70,200 $73,200
Bill Payments $40,474 $67,160 $94,183
Subtotal Spent on Operations $95,074 $137,360 $167,383
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 $95,074 $137,360 $167,383
Net Cash Flow ($26,401) $7,939 $36,293
Cash Balance $8,099 $16,037 $52,331

7.5 Projected Balance Sheet

The following table will indicate the Projected Balance Sheet.

Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $8,099 $16,037 $52,331
Other Current Assets $0 $0 $0
Total Current Assets $8,099 $16,037 $52,331
Long-term Assets
Long-term Assets $25,000 $25,000 $25,000
Accumulated Depreciation $5,004 $10,008 $15,012
Total Long-term Assets $19,996 $14,992 $9,988
Total Assets $28,095 $31,030 $62,319
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $4,287 $5,630 $7,930
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $4,287 $5,630 $7,930
Long-term Liabilities $0 $0 $0
Total Liabilities $4,287 $5,630 $7,930
Paid-in Capital $65,000 $65,000 $65,000
Retained Earnings ($5,500) ($41,191) ($39,601)
Earnings ($35,691) $1,591 $28,990
Total Capital $23,809 $25,399 $54,389
Total Liabilities and Capital $28,095 $31,030 $62,319
Net Worth $23,809 $25,399 $54,389

7.6 Business Ratios

The following table displays Business Ratios of this company as well as those within the restaurant industry.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 111.58% 40.18% 6.96%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 28.39%
Total Current Assets 28.83% 51.68% 83.97% 37.68%
Long-term Assets 71.17% 48.32% 16.03% 62.32%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 15.26% 18.15% 12.72% 19.17%
Long-term Liabilities 0.00% 0.00% 0.00% 29.21%
Total Liabilities 15.26% 18.15% 12.72% 48.38%
Net Worth 84.74% 81.85% 87.28% 51.62%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 72.96% 72.96% 72.96% 59.31%
Selling, General & Administrative Expenses 124.93% 71.86% 58.72% 39.09%
Advertising Expenses 0.00% 0.00% 0.00% 2.75%
Profit Before Interest and Taxes -51.97% 1.56% 20.33% 1.59%
Main Ratios
Current 1.89 2.85 6.60 1.26
Quick 1.89 2.85 6.60 0.87
Total Debt to Total Assets 15.26% 18.15% 12.72% 54.38%
Pre-tax Return on Net Worth -149.91% 8.95% 76.14% 3.27%
Pre-tax Return on Assets -127.04% 7.32% 66.45% 7.17%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -51.97% 1.09% 14.23% n.a
Return on Equity -149.91% 6.26% 53.30% n.a
Activity Ratios
Accounts Payable Turnover 10.44 12.17 12.17 n.a
Payment Days 27 26 26 n.a
Total Asset Turnover 2.44 4.68 3.27 n.a
Debt Ratios
Debt to Net Worth 0.18 0.22 0.15 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital $3,812 $10,407 $44,401 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.41 0.21 0.31 n.a
Current Debt/Total Assets 15% 18% 13% n.a
Acid Test 1.89 2.85 6.60 n.a
Sales/Net Worth 2.88 5.72 3.74 n.a
Dividend Payout 0.00 0.00 0.00 n.a