Cyclist Repair Center
Financial Plan
The following sections outline important financial information.
8.1 Important Assumptions
The following table details 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 |
8.2 Break-even Analysis
The Break-even Analysis is shown below.

Break-even Analysis | |
Monthly Revenue Break-even | $21,753 |
Assumptions: | |
Average Percent Variable Cost | 5% |
Estimated Monthly Fixed Cost | $20,665 |
8.3 Projected Profit and Loss
The following table and charts illustrate the projected profit and loss.




Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $136,646 | $368,944 | $442,733 |
Direct Cost of Sales | $6,832 | $18,447 | $22,137 |
Other Costs of Sales | $0 | $0 | $0 |
Total Cost of Sales | $6,832 | $18,447 | $22,137 |
Gross Margin | $129,814 | $350,497 | $420,597 |
Gross Margin % | 95.00% | 95.00% | 95.00% |
Expenses | |||
Payroll | $190,000 | $258,000 | $270,000 |
Sales and Marketing and Other Expenses | $2,400 | $2,400 | $2,400 |
Depreciation | $4,404 | $4,404 | $4,404 |
Rent | $18,000 | $18,000 | $19,000 |
Utilities | $1,680 | $1,680 | $1,680 |
Insurance | $3,000 | $3,000 | $3,500 |
Payroll Taxes | $28,500 | $38,700 | $40,500 |
Total Operating Expenses | $247,984 | $326,184 | $341,484 |
Profit Before Interest and Taxes | ($118,170) | $24,313 | $79,113 |
EBITDA | ($113,766) | $28,717 | $83,517 |
Interest Expense | $2,740 | $2,270 | $1,783 |
Taxes Incurred | $0 | $6,613 | $23,199 |
Net Profit | ($120,911) | $15,430 | $54,131 |
Net Profit/Sales | -88.48% | 4.18% | 12.23% |
8.4 Projected Cash Flow
The following chart and table show the projected cash flow.

Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $136,646 | $368,944 | $442,733 |
Subtotal Cash from Operations | $136,646 | $368,944 | $442,733 |
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 | $136,646 | $368,944 | $442,733 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $190,000 | $258,000 | $270,000 |
Bill Payments | $56,687 | $90,087 | $112,301 |
Subtotal Spent on Operations | $246,687 | $348,087 | $382,301 |
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 | $4,868 | $4,868 | $4,868 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $251,556 | $352,955 | $387,169 |
Net Cash Flow | ($114,909) | $15,990 | $55,564 |
Cash Balance | $6,591 | $22,580 | $78,145 |
8.5 Projected Balance Sheet
The following table presents the projected balance sheet.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $6,591 | $22,580 | $78,145 |
Other Current Assets | $0 | $0 | $0 |
Total Current Assets | $6,591 | $22,580 | $78,145 |
Long-term Assets | |||
Long-term Assets | $22,000 | $22,000 | $22,000 |
Accumulated Depreciation | $4,404 | $8,808 | $13,212 |
Total Long-term Assets | $17,596 | $13,192 | $8,788 |
Total Assets | $24,187 | $35,772 | $86,933 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $6,465 | $7,488 | $9,386 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
Subtotal Current Liabilities | $6,465 | $7,488 | $9,386 |
Long-term Liabilities | $25,132 | $20,264 | $15,396 |
Total Liabilities | $31,597 | $27,752 | $24,782 |
Paid-in Capital | $122,000 | $122,000 | $122,000 |
Retained Earnings | ($8,500) | ($129,411) | ($113,980) |
Earnings | ($120,911) | $15,430 | $54,131 |
Total Capital | ($7,411) | $8,020 | $62,151 |
Total Liabilities and Capital | $24,187 | $35,772 | $86,933 |
Net Worth | ($7,411) | $8,020 | $62,151 |
8.6 Business Ratios
The following table offers many business ratios specific to this business. The U.S. Standard Industrial Classifications (SIC) currently classifies sports therapy and training clinics as: Offices of health practitioners, nec. – 8049.9900. The industry profile ratios are shown for comparison.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | 170.00% | 20.00% | 3.71% |
Percent of Total Assets | ||||
Other Current Assets | 0.00% | 0.00% | 0.00% | 44.76% |
Total Current Assets | 27.25% | 63.12% | 89.89% | 80.71% |
Long-term Assets | 72.75% | 36.88% | 10.11% | 19.29% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | 26.73% | 20.93% | 10.80% | 27.67% |
Long-term Liabilities | 103.91% | 56.65% | 17.71% | 14.39% |
Total Liabilities | 130.64% | 77.58% | 28.51% | 42.06% |
Net Worth | -30.64% | 22.42% | 71.49% | 57.94% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 95.00% | 95.00% | 95.00% | 100.00% |
Selling, General & Administrative Expenses | 183.48% | 90.82% | 82.77% | 77.50% |
Advertising Expenses | 0.00% | 0.00% | 0.00% | 1.52% |
Profit Before Interest and Taxes | -86.48% | 6.59% | 17.87% | 3.26% |
Main Ratios | ||||
Current | 1.02 | 3.02 | 8.33 | 2.29 |
Quick | 1.02 | 3.02 | 8.33 | 2.00 |
Total Debt to Total Assets | 130.64% | 77.58% | 28.51% | 55.30% |
Pre-tax Return on Net Worth | 1631.60% | 274.86% | 124.42% | 10.01% |
Pre-tax Return on Assets | -499.91% | 61.62% | 88.95% | 22.39% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | -88.48% | 4.18% | 12.23% | n.a |
Return on Equity | 0.00% | 192.40% | 87.10% | n.a |
Activity Ratios | ||||
Accounts Payable Turnover | 9.77 | 12.17 | 12.17 | n.a |
Payment Days | 27 | 28 | 27 | n.a |
Total Asset Turnover | 5.65 | 10.31 | 5.09 | n.a |
Debt Ratios | ||||
Debt to Net Worth | 0.00 | 3.46 | 0.40 | n.a |
Current Liab. to Liab. | 0.20 | 0.27 | 0.38 | n.a |
Liquidity Ratios | ||||
Net Working Capital | $125 | $15,092 | $68,759 | n.a |
Interest Coverage | -43.12 | 10.71 | 44.37 | n.a |
Additional Ratios | ||||
Assets to Sales | 0.18 | 0.10 | 0.20 | n.a |
Current Debt/Total Assets | 27% | 21% | 11% | n.a |
Acid Test | 1.02 | 3.02 | 8.33 | n.a |
Sales/Net Worth | 0.00 | 46.00 | 7.12 | n.a |
Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |