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FINANCIAL PLAN
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Beginning Balance Sheet
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Instructions:
Before we can start your financial plan, we need a starting point.
There are two tables on this page. In the first table, if it is an
existing business, we want you to enter in the beginning balances of
your Balance Sheet
for the period covered by your business plan. In the second table, we
want you to provide us with a breakdown of your accounts payable. If
you are a new business, you may want to enter all the balances on this
page at $0.
Comments:
Once you
have entered information, use the Calculate Button to total your
entries. To make sure that Assets are equal to Liabilities and Owner's
Equity, Retained Earnings are calculated for you in the Balance Sheet.
If the figure is not correct, this means that at least one of your
other balances was entered incorrectly. Click on an underlined word on
this page or visit the Tips & Links for further help.
Note:
Only enter whole numbers into the numerical boxes. The boxes will not accept commas, $ signs, cents or letters.
Provide a breakdown of your beginning accounts payable below.
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Note 1: Revenue Assumptions
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Instructions:
The next step is to estimate your sales revenue for the next three years.
This page has two tables. In the first table, we want you to enter your
estimated sales revenue by month in Year 1 for up to four product or service
categories. Use the top row to enter the names of these product or service
categories. In the second table, we want you to enter your estimated sales
revenue by product for Years 2 and 3.
Comments:
Sales revenues are usually recorded when your product or service is sold rather
than when you actually receive payment for it. You will notice that the tables
each have an introductory sentence (for example, "Our revenue projections by
product and by month for the first year are:"). This page and others will be
printed out as notes to your financial
statements and the sentences will help the reader understand the tables.
Once you have entered information, use the Calc Button to total your entries.
Click on an underlined word in the tables or visit the Tips & Links for further assistance.
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Note 2: Assumptions Regarding the Collection of Sales Revenue
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Instructions:
It's one thing to make a sale, its another thing to collect the money.
We now want you to estimate when you will be collecting the cash from
your sales. To help you do this, there are four tables on this page. In
the first table, we want you to tell us what percent of your sales you
expect to collect during the month your product or service is sold and
what percent you expect to collect in the following month, in two
months and in three months. If you operate strictly on a cash basis
(you do not sell on credit), 100% of your sales would be collected in
the current month. To make sure the percents add up to 100%, the
current month percentage is calculated for you based upon the percents
you put in the other rows.
Comments:
Based
upon the information you provide, we use the second table to calculate
how much money you would be collecting each month. If you want, you can
make an entry in the adjustment column to revise this estimate for any
one or all of the months. The third table calculates for you how much money you
would be owed by your customers at the end of Year 1. In the fourth
table, we want you to estimate how much you would be owed by your
customers at the end of Years 2 and 3. Click on an underlined word in
the tables or visit Tips & Links for further assistance.
b.
Based on these assumptions we have projected how much we will collect
from our sales in each month. The following table also identifies any
adjustments we may have made to these figures.
c. Not all of our sales in the first year will be collected during that year. Based on the assumptions shown above our Accounts Receivable at the end of Year 1 will be:
d. We assume that our Accounts Receivable at the end of Years 2 and 3 will be:
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Note 3: Cost of Sales Assumptions
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Instructions:
The purpose of this page is to determine the Cost of Sales figures
which are going to show up on your cash flow statements and your income
statement. In order to do this, we need you to estimate how much you
are going to pay for Cost of Sales items (by month in Year 1 and in
total for Years 2 and 3), how much inventory you will have at the end
of Years 1, 2 and 3, and how much of these goods and services you will
have received but won't have paid for yet by the end of each year.
Comments:
For a
manufacturing operation, direct costs of sales typically includes the
cost of materials used in producing the good, wage costs for people
directly involved in the manufacture of your products, and fixed costs
which are directly associated with manufacturing. Examples of fixed
costs include wages for production managers, lease expenses related to
manufacturing facilities and equipment, and supplies used in the
production process. Wage costs and most fixed costs are generally paid
in the month they are incurred. However, depending upon your
relationship with suppliers, you may be able to delay payment for
supplies by thirty days or more. There are five tables on this page. Based on the
information you enter in the first four tables, we use the fifth table
to calculate the Costs of Sales expense that will show up on your
income statement. Once you have entered information, use the Calc
Button to total your entries. Click on an underlined word in the tables
or visit Tips & Links for further assistance.
b. Our assumptions regarding the amount that we will pay in Years 2 and 3 for Cost of Sales items are listed below. These figures show up on our annual Cash Flow Statement.
c.
Some of these payments may have been to produce or purchase goods which
we won't have sold yet. We estimate the value of such goods which we
will have in inventory at the end of each year will be:
d.
(Apart from what we have already paid for) There may be additional Cost
of Sales goods or services which we have received but we won't have
paid for yet. We estimate the amount that we will owe (have as an
Account Payable) for Cost of Sales items at the end of each year will
be:
e.
We have calculated our Cost of Sales expenses, based on these
assumptions. These figures (which show up on our Income Statement) are
shown in both dollar values and as a percent of our projected revenues.
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Note 4: Sales and Marketing Assumptions
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Instructions:
The purpose of this page is to determine the Sales and Marketing
figures which are going to show up on your cash flow statements and
your income statement. In order to do this, we need you to estimate how
much you are going to pay for Sales and Marketing items (by month in
Year 1 and in total for Years 2 and 3) and how much you will owe at the
end of the year for Sales and Marketing-related goods and services that
you will have received but won't have paid for yet by the year-end.
Comments:
Examples
of sales and marketing costs include wages and commission costs for
sales staff, advertising costs, and travel, entertainment and trade
show costs related to marketing. The timing of sales and marketing
expenses should be reviewed on an item by item basis. Most marketing
expenses will be paid periodically throughout the year. However, some
expenses such as advertising in the telephone directory may be paid
only once per year. There are four tables on this page. Based on the
information you enter in the first three tables, we use the fourth
table to calculate the Sales and Marketing expense that will show up on
your income statement. Once you have entered information, use the Calc
Button to total your entries. Click on an underlined word in the tables
or visit Help/Links for further assistance.
b. Our assumptions regarding the amount that we will pay in Years 2
and 3 for Sales and Marketing items are listed below. These figures show up on our annual Cash Flow
Statement.
c. Apart from what we already have paid for, there may be additional Sales and Marketing items which
we have received by we won't have paid for yet. We estimate the amount that we will owe (have as an Account
Payable) for Sales and Marketing items at the end of each year will be:
d. d. We have calculated our Sales and Marketing expenses based on these assumptions. These figures
(which show up on our Income Statement) are shown in both dollar values and as a percent of our projected
revenues.
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