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7.1 Important Assumptions

The financial plan depends on important assumptions, most of which are illustrated in the following table.

The key underlying assumptions are:

  • We assume a slow-growth economy of five percent the first year, and three percent thereafter, without major recession.

  • We assume that we will grow as managers during the process, this growth will manifest itself as flat line expense growth over the five-year period, leading to increased annual cash flow.

  • We assume access to equity capital and financing sufficient to maintain our financial plan as shown in the tables.

  • We assume continued popularity of nightclubs in America and the growing demand for high-energy themed and casual dining venues.

Business Plan Pro Sample

2001

2002

2003

$284,736

$298,968

$313,916

$107,200

$112,560

$118,188

0

0

0

$391,936

$411,528

$432,104

2001

2002

2003

1

2

3

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

25.00%

25.00%

25.00%

10.00%

10.00%

10.00%

0.00%

0.00%

0.00%

$391,936

$411,528

$432,104

$227,634

$250,397

$275,437

$1,757,759

$1,874,826

$1,998,594

$363,139

$404,445

$444,889

Table: General Assumptions

General Assumptions

Plan Month Current Interest Rate Long-term Interest Rate Tax Rate Sales on Credit % Other Calculated Totals Payroll Expense Sales on Credit New Accounts Payable Inventory Purchase

Table: Personnel

Personnel Plan

Salaried Staff Hourly Staff Total People Total Payroll

Nightclub - Sample Plan

7.0 Financial Plan

The financial projections for this plan are presented in the tables and charts of the following subtopics.

Copyright © Palo Alto Software, Inc. 2002 All rights reserved. www.paloalto.com Not for reproduction, publication, or distribution.

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