Batten-Hatchez Security
Financial Plan
Forecast
Key Assumptions
The long-term interest rate is 6% for a home equity loan taken out in year 2 to cover the cash needs for a move to an office space.
In addition to the assumptions shown in this table, the business makes the following assumptions:
- That the security guard industry will experience an overall upswing in the next three years
- That the sales record of Chindit Batten at his previous firm can be replicated at Batten-Hatchez
Revenue by Month
Expenses by Month
Net Profit (or Loss) by Year
Financing
Use of Funds
Start-up Expenses are
Legal Fees $15,000
Surety Bond $1,200
Stationery $2,000
Insurance $10,000
Training $5,000
Website $2,000
Brochure $1,500
TOTAL START-UP EXPENSES $36,700
Sources of Funds
Our sources of funds are investors: Louis Giordano, Jared Case, and family and friends.
Statements
Projected Profit & Loss
| 2020 | 2021 | 2022 | |
|---|---|---|---|
| Revenue | $913,372 | $1,086,300 | $1,254,000 |
| Direct Costs | $553,446 | $632,520 | $698,670 |
| Gross Margin | $359,926 | $453,780 | $555,330 |
| Gross Margin % | 39% | 42% | 44% |
| Operating Expenses | |||
| Salaries & Wages | $86,400 | $271,728 | $277,160 |
| Employee Related Expenses | $17,280 | $54,346 | $55,432 |
| Marketing | $19,200 | $19,200 | $19,200 |
| Promotion | $16,800 | $16,800 | $16,800 |
| Surety Bond | $1,380 | $1,380 | $1,380 |
| Training | $6,516 | $6,516 | $6,516 |
| Licences and Permits | $7,356 | $7,356 | $7,356 |
| Total Operating Expenses | $154,932 | $377,326 | $383,844 |
| Operating Income | $204,994 | $76,454 | $171,486 |
| Interest Incurred | $164 | ||
| Depreciation and Amortization | $0 | $0 | $0 |
| Gain or Loss from Sale of Assets | |||
| Income Taxes | $30,724 | $11,469 | $25,723 |
| Total Expenses | $739,266 | $1,021,315 | $1,108,237 |
| Net Profit | $174,106 | $64,985 | $145,763 |
| Net Profit/Sales | 19% | 6% | 12% |
Projected Balance Sheet
| Starting Balances | 2020 | 2021 | 2022 | |
|---|---|---|---|---|
| Cash | $44,000 | $169,832 | $240,705 | $379,875 |
| Accounts Receivable | $160,926 | $108,630 | $125,400 | |
| Inventory | ||||
| Other Current Assets | ||||
| Total Current Assets | $44,000 | $330,758 | $349,335 | $505,275 |
| Long-Term Assets | $1,000 | $1,000 | $1,000 | $1,000 |
| Accumulated Depreciation | $0 | $0 | $0 | |
| Total Long-Term Assets | $1,000 | $1,000 | $1,000 | $1,000 |
| Total Assets | $45,000 | $331,758 | $350,335 | $506,275 |
| Accounts Payable | $100,614 | $68,377 | $74,992 | |
| Income Taxes Payable | $17,039 | $2,867 | $6,429 | |
| Sales Taxes Payable | $0 | $0 | $0 | |
| Short-Term Debt | $5,000 | |||
| Prepaid Revenue | ||||
| Total Current Liabilities | $5,000 | $117,653 | $71,244 | $81,421 |
| Long-Term Debt | $0 | $0 | $0 | $0 |
| Long-Term Liabilities | $0 | $0 | $0 | $0 |
| Total Liabilities | $5,000 | $117,653 | $71,244 | $81,421 |
| Paid-In Capital | $76,700 | $76,700 | $76,700 | $76,700 |
| Retained Earnings | ($36,700) | ($36,700) | $137,406 | $202,391 |
| Earnings | $174,106 | $64,985 | $145,763 | |
| Total Owner’s Equity | $40,000 | $214,106 | $279,091 | $424,854 |
| Total Liabilities & Equity | $45,000 | $331,758 | $350,335 | $506,275 |
Projected Cash Flow Statement
| 2020 | 2021 | 2022 | |
|---|---|---|---|
| Net Cash Flow from Operations | |||
| Net Profit | $174,106 | $64,985 | $145,763 |
| Depreciation & Amortization | $0 | $0 | $0 |
| Change in Accounts Receivable | ($160,926) | $52,296 | ($16,770) |
| Change in Inventory | |||
| Change in Accounts Payable | $100,614 | ($32,236) | $6,615 |
| Change in Income Tax Payable | $17,039 | ($14,172) | $3,562 |
| Change in Sales Tax Payable | $0 | $0 | $0 |
| Change in Prepaid Revenue | |||
| Net Cash Flow from Operations | $130,832 | $70,873 | $139,170 |
| Investing & Financing | |||
| Assets Purchased or Sold | |||
| Net Cash from Investing | |||
| Investments Received | |||
| Dividends & Distributions | |||
| Change in Short-Term Debt | ($5,000) | ||
| Change in Long-Term Debt | $0 | $0 | $0 |
| Net Cash from Financing | ($5,000) | $0 | $0 |
| Cash at Beginning of Period | $44,000 | $169,832 | $240,705 |
| Net Change in Cash | $125,832 | $70,873 | $139,170 |
| Cash at End of Period | $169,832 | $240,705 | $379,875 |
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