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It will be valuable for your own comfort level, as well as for the investor's or lender's, to perform financial projections of the business. Lenders will be interested in learning whether your business will generate enough cash flow to pay back the loan, while investors will be more interested in understanding how much return they can get out of this investment. Financial Statement Templates on MS Excel Financial statements are documents used to demonstrate the financial performance of a business. Past (if applicable) and future financial statements must be included in a business plan. Once entrepreneurs understand the working of various financial statements, they can use the following Microsoft Excel financial statement templates provided in this section. These statements can, of course, be modified, but please make sure calculations are performed correctly. Use of these templates without full understanding of financial statements is strongly discouraged by Start Up. For each statement you want to use, click on the link, save the
spreadsheet onto your hard drive or floppy disk, and then work on
it. This section will help you to itemize the costs of starting your
business or undergoing an expansion project. Enter the appropriate
cost figures. If there are start-up costs not included in the given
categories, indicate them at line item 12. The spreadsheet will
automatically add up the costs for you.
2. Capital Requirement Assessment This table will help you to assess your capital requirement for the business and determine how much money you will need to borrow.
(1) Include only down payment If uses of fund is more than sources of fund, then the difference is the amount you will need to raise, either in the form of a loan from bank or from Start Up, or in the form of equity investment from a venture capital firm. 3. Financial Projections Income Statement The Income Statement Also called profit and loss statement, provides summary of the revenue, costs, and expenses of a company during an accounting period. It will help you to understand how much profit (loss) your business can generate. The income statement provides a moving financial picture of a company over a period of time. Enter in the monthly sales figures and cost of sales figures by product or service. You may want to change the entries "Product A," "Product B," etc. to the actual name of your product or service. The spreadsheet will calculate the total sales, total cost of sales, and gross profit. Next, enter in all expenses. Additional expenses not indicated on the spreadsheet can be entered in rows 34-37. The spreadsheet will then calculate the total operating expenses
and the profit (or loss) before taxes.
Provides a snap shot picture of a company's financial health at a particular point in time. Assets are equal to liabilities and equity, and the balance sheet is a listing of the items making up the two sides of the equation. Unlike the income statement, which shows the results of operations over a period of time, a balance sheet show the status of a company's assets, liabilities, and equity at one point in time. On the spreadsheet, you will determine the balance sheet at the time of start-up and at the end of years 1,2, and 3. Enter the appropriate figures into each of the sub-categories. The spreadsheet automatically calculates the totals for each category and sub-category. Analyzes all changes affecting cash and details the timing and amount of expected cash inflows and outflows. While income statement is useful in analyzing your business from an accounting and tax point of view, it does not tell you how much cash you have on hand at any one time. For example, even though you included sales to customer X in the income statement, you may still have not received the cash payment because the sales were on credit. Therefore, it is important to realize that even companies with positive profit numbers on the income statement may go bankrupt because they can not generate enough cash to meet current obligations. If the cash flow figure goes negative, that means your business is insolvent, i.e., your business is unable to pay the bills. In the spreadsheet, start by filling in the amount of cash you have on hand at the beginning of the year, or at the time of business start up. Then fill in you initial cash expenditures. If you find there are costs in addition to those outlined on the cash flow projection, enter them where it says "Other (indicate)" (row 24 to 26). Next, fill in your monthly cash intakes and expenditures. At the
bottom you should also include your monthly loan payment, capital
purchases you expect to make, and the amount of cash you plan on
taking out of The process for filling out the Year 2 and 3 Cash Flow Projection is the same, except that now you are estimating cash receipts and cash paid out per quarter (three months at a time) rather than for each individual month.
This section will help you to determine how many units the business must sell in order to cover the fixed costs. It is important to get a sense of what it takes to break even. First, calculate contribution margin per unit of sales Contribution margin per unit = Unit sale price - Variable costs per unit - Unit sale price is the price set for your product or service
on a per unit basis Break even point (unit) = Fixed Expenses / Contribution margin per unit Fixed costs include all costs that are independent of sales level. They include the following: - Rent |
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