Business plan template.pdf

You may also enter industry average ratios for

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analysis. You may also enter industry average ratios for comparison. In the Appendices , put year-end balance sheets, operating statements, and business income tax returns for the past three years, plus your most current balance sheet and operating statement. Debt Schedule This table gives in-depth information that the financial statements themselves do not usually provide. Include a debt schedule in the following format for each note payable on your most recent balance sheet. Table 4: Debt Schedule To whom payable Original amount Original date Present balance Rate of interest Maturity date Monthly payment Security Current/past due
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Page 23 of 29 Financial Plan The financial plan consists of a 12-month profit and loss projection, a four-year profit and loss projection (optional), a cash-flow projection, a projected balance sheet, and a breakeven calculation. Together, these spreadsheets constitute a reasonable estimate of your company's financial future. More important, however, the process of thinking through the financial plan will improve your insight into the inner financial workings of your company. 12-Month Profit and Loss Projection Explain the major assumptions used to estimate company income and expenses. Your sales projection should come from an annual sales forecast. Pay special attention to areas where historical performance varies markedly from your projections. Four-Year Profit Projection (Optional) The 12-month projection is the heart of your financial plan. However, this worksheet is for those who want to carry their forecasts beyond the first year. It is expected of those seeking venture capital. Bankers pay more attention to the 12-month projection. Of course, keep notes of your key assumptions, especially about things you expect to change dramatically over the years. Projected Cash Flow The cash-flow projection is just a forward look at your checking account. For each item, determine when you actually expect to receive cash (for sales) or when you will actually have to write a check (for expense items). Your cash flow will show you whether your working capital is adequate. Clearly if your cash on hand goes negative, you will need more. It will also show when and how much you need to borrow. Explain your major assumptions, especially those that make the cash flow differ from a profit and loss statement, such as: If you make a sale in month 1, when do you actually collect the cash? When you buy inventory or materials, do you pay in advance, upon delivery, or much later?
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Page 24 of 29 How will this affect cash flow? Are some expenses payable in advance? Are there irregular expenses, equipment purchase, or inventory buildup that should be budgeted? And of course, depreciation does not appear at all because you never write a check for it.
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