•Identify the components needed in cash flow statements. •Explain the benefits of cash-flow analysis and any problems that could arise if it is not conducted. Profit
and Loss Projections Yr 1 Yr 2 Yr 3 Revenues 114400 124800 135200 Expenses Salary- the owner 35000 40000 45000 Outside Services 4000 4000 4000 Supplies 30000 30000 30000 Repair and
Maintenance 5000 5000 5000 Advertising 5000 5000 5000 Telephone 2000 2000 2000 Insurance 2500 2500 2500 Interest (on loans) 4000 3200 2400 Depreciation and
amortization 16000 16000 16000 Total
expenses 103500 107700 111900 Profit before
tax 10900 17100 23300 less taxation
35% 3815 5985 8155 Profit after
tax 7085 11115 15145 Summary Statement Sources of Capital Buildings/real
estate $
80,000 to be depreciated over 20 years life Owners' and other
investments $
5,000 $5000 will be invested in cash by
owner and will be issued euqal common stock Bank loans 50,000 Loan to be repaid in 5 years equl
installment of $10000 + interest @8% on remaining balance at year end. Other loans - Total Source of
Funds $
55,000 Startup Expenses Capital equipment
10,000 to be depreciated over 10 years Location/administration
expenses 5,000 to be amortized over
5 years Opening inventory - AS the order is
placed when order is received, no need to maintain inventory Advertising/promotional
expenses 15,000 Including Website
development, to be amortized over 5 years. Other expenses 5,000 Contingency fund 5,000 Working capital 15,000 Minimum cash balance
to be maitained. Total Assets $
55,000 Security and
Collateral for Loan Proposal Collateral for
Loans Value Description Real estate $
80,000 Personal Property
and Loss Projections Yr 1 Yr 2 Yr 3 Revenues 114400 124800 135200 Expenses Salary- the owner 35000 40000 45000 Outside Services 4000 4000 4000 Supplies 30000 30000 30000 Repair and
Maintenance 5000 5000 5000 Advertising 5000 5000 5000 Telephone 2000 2000 2000 Insurance 2500 2500 2500 Interest (on loans) 4000 3200 2400 Depreciation and
amortization 16000 16000 16000 Total
expenses 103500 107700 111900 Profit before
tax 10900 17100 23300 less taxation
35% 3815 5985 8155 Profit after
tax 7085 11115 15145 Summary Statement Sources of Capital Buildings/real
estate $
80,000 to be depreciated over 20 years life Owners' and other
investments $
5,000 $5000 will be invested in cash by
owner and will be issued euqal common stock Bank loans 50,000 Loan to be repaid in 5 years equl
installment of $10000 + interest @8% on remaining balance at year end. Other loans - Total Source of
Funds $
55,000 Startup Expenses Capital equipment
10,000 to be depreciated over 10 years Location/administration
expenses 5,000 to be amortized over
5 years Opening inventory - AS the order is
placed when order is received, no need to maintain inventory Advertising/promotional
expenses 15,000 Including Website
development, to be amortized over 5 years. Other expenses 5,000 Contingency fund 5,000 Working capital 15,000 Minimum cash balance
to be maitained. Total Assets $
55,000 Security and
Collateral for Loan Proposal Collateral for
Loans Value Description Real estate $
80,000 Personal Property
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