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Unformatted text preview: s and Chapter 16: Cash
is King. You’ve seen then that the Balance Sheet table shows the ﬁnancial position of the business, its
assets and liabilities, at a speciﬁed time. A standard business plan includes a projected Balance Sheet
table for each of the ﬁrst 12 months in the plan, and for each of the three years.
The ironclad rule of Western double-entry
bookkeeping and accounting is that assets
are equal to capital and liabilities. This is
what balance means. If you think about it,
you’ll notice we also used that rule in the
Start-up costs section of Chapter 6: Describe
Your Company. It comes up again with the
Balance Sheet table as we use this rule to
calculate retained earnings, which makes the
balance correct. BALANCE SHEET TABLE The illustration shows the Balance Sheet
table, or pro forma Balance Sheet table. The
Balance Sheet table should naturally start
with either your start-up costs or your ending
balance from the previous year, depending
on whether you are a start-up company or
an ongoing company. Then, for the ﬁrst 12
months of your plan, it should give detailed
projections of your assets, liabilities, and
capital as your business progresses. The
calculations for this come mainly from your
income statement and cash ﬂow. Between
This illustration shows the Balance Sheet table for AMT, Inc.,
those two statements, plus the beginning
the sample company ﬁrst introduced in Chapter 14: About
balances, your Balance Sheet should be
Business Numbers (numbers displayed in thousands).
virtually done before you start. HURDLE: THE BOOK 17.2 ON BUSINESS PLANNING Standard Industry Proﬁles
Whenever possible, a business plan should compare projected numbers to standard industry numbers
of the type we discussed earlier in Chapter 9: The Business You’re In. We show an example here, in
which the sample case’s main business numbers for Year 1 through Year 3 are compared to a standard
industry proﬁle, shown in the column named “Industry Proﬁle.” STANDARD INDUSTRY COMPARISON This samp...
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This note was uploaded on 01/26/2014 for the course BUINESS 102 taught by Professor Unknown during the Winter '09 term at University of Phoenix.
- Winter '09