Short Note On Financial Projections

1035 Words Dec 9th, 2015 5 Pages
Financial Projections
We present four scenarios (modest, reasonable expected, excellent and worst case) in our projections. We project out five years (years 1 to 5). We use the contribution margin income statement format with the financial projections. Variable costs include the materials and variable payroll. Fixed costs include the rent and electricity. Sales and variable costs are based on units or sandwiches and other products sold at the shop.
Modest Scenario
Year 1
Year 2
Year 3
Year 4
Year 5
Sales
39,000
48,000
58,000
65,150
75,150
Variable Cost
Materials
7,440
8,000
9,000
10,000
11,700
Payroll
20,000
23,550
25,550
27,500
29,150
Contribution Margin
11,560
16,450
23,450
27,650
34,300
Fixed Cost
Rent
15,000
15,000
15,000
15,000
15,000
Electricity
3,000
3,000
3,000
3,000
3,000
Total Fixed Costs
18,000
18,000
18,000
18,000
18,000
Net Profit (Loss)
(6,440)
(1,550)
5,450
9,650
16,300
Reasonably Expected Scenario
Year 1
Year 2
Year 3
Year 4
Year 5
Sales
50,000
65,000
75,000
90,000
100,000
Variable Cost
Materials
9,000
11,000
13,000
15,000
17,000
Payroll
25,000
27,150
29,150
33,150
35,000
Contribution Margin
16,000
26,850
32,850
41,850
48,000
Fixed Cost
Rent
15,000
15,000
15,000
15,000
15,000
Electricity
3,000
3,000
3,000
3,000
3,000
Total Fixed Costs
18,000
18,000
18,000
18,000
18,000
Net Profit (Loss)
(2,000)
8,850
14,850
23,850
30,000
Excellent Scenario
Year 1
Year 2
Year 3
Year 4
Year 5
Sales
80,000
100,000
120,000
150,000
250,000
Variable Cost
Materials
11,000
12,000…
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