Pizza Shop - Sales Forecast & Forecasted Financial Statements

Part A

Business Plan:

Sales Forecast & Forecasted Financial Statements

Income Statements for the period ending 31 December

Actual Base Forecasted

2002 2003 2004 % 2005 2006 2007

Sales:

Accommodation 125,600 157,500 192,693 31.03% 227,786 199,729 221,647

Functions for locals 10,000 25,000 50,000 187.50% 66,667 83,333 100,000

Total sales 135,600 182,500 242,693 218.53% 294,453 283,063 321,647

Expenses:

Expenses of functions 6,000 15,000 30,000 60.00% 40,000 50,000 60,000

Payroll 24,000 27,000 30,000 10.00% 33,000 36,300 39,930

Advertising and promotion 2,000 2,500 3,000 5000 8,000 13,000 18,000

Depreciation 4,440 4,440 4,440 0.00% 4,440 4,440 4,440

Insurance 10,000 12,000 15,000 10.00% 16,500 18,150 19,965

Telephone 2,000 2,200 2,400 10.00% 2,640 2,904 3,194

Security 300 350 420 10.00% 462 508 559

Duties and subscriptions 140 155 175 10.00% 193 212 233

Cleaning supplies 200 250 400 10.00% 440 484 532

Groceries 10,000 12,000 15,000 10.00% 16,500 18,150 19,965

Payroll taxes 2,200 2,250 2,500 10.00% 2,750 3,025 3,328

Total operating expenses 61,280 78,145 103,335 42.58% 124,925 147,173 170,146

Profit before interest and tax 74,520 104,355 140,458 57.87% 169,528 135,890 151,501

Interest expense 48,000 48,000 48,000 19.78% 58,237 55,984 63,616

Taxes incurred 7,956 16,907 27,737 11.43% 33,653 32,351 36,761

Net profit 18,563 39,448 64,721 26.67% 77,639 47,555 51,125

Calculation Occupancy of 2004

(980*45%*26) +

( 1,225*85%*26) = 38538.5

Actual accommodation revenue = 192,693

Available accommodations 5.00

Balance Sheets as at 31 December Actual Base Forecasted

2002 2003 2004 % 2005 2006 2007

Current Assets

Cash 29,888 36,577 46,477 26,389 24,208 31,597

Accounts Receivable 2,600 3,900 6,429 2.65% 7,800 7,498 8,521

Other Current Assets 800 900 1,000 0.41% 1,213 1,166 1,325

Total Current Assets 33,288 41,377 53,906 3.06% 35,403 32,873 41,443

Non-current Assets 770,000 770,000 770,000 317.27% 934,220 898,082 1,020,501

Less: Accumulated Depreciation 25,560 30,000 34,440 14.19% 41,785 40,169 45,644

Total Non-current Assets 744,440 740,000 735,560 303.08% 892,434 857,914 974,857

Total Assets 777,728 781,377 789,466 306.14% 927,837 890,786 1,016,300

0.00% 0 0 0

Current Liabilities 0.00% 0 0 0

Accounts Payable 6,516 3,878 4,564 1.88% 5,537 5,323 6,049

Non-current Liabilities 525,000 525,000 525,000 216.32% 606,968 582,329 665,796

Total Liabilities 531,516 528,878 529,564 218.20% 612,505 587,652 671,845

Equity 0.00% 0 0 0

Capital 100,000 100,000 100,000 41.20% 121,327 116,634 132,533

Retained Earnings 127,648 113,051 92,181 37.98% 111,841 107,514 122,170

Current Earnings 18,564 39,448 67,721 27.90% 82,164 78,986 89,752

Total Capital 246,212 252,499 259,902 107.09% 315,332 303,134 344,455

Total Liabilities and Capital 777,728 781,377 789,466 325.29% 927,837 890,786 1,016,300

Assumption:

We have assumed that only Expenses of functions and Cleaning supplies are variable expenses and all other expenses are fixed.

Calculation of Ratios:

Calculation of Ratios Actual Forecasted

2002 2003 2004 2005 2006 2007

Current Ratio = current assets / current liabilities 5.11 10.67 11.81 6.39 6.18 6.85

Debt ratio = Total liabilities / Total assets 2.16 2.09 2.04 1.94 1.94 1.95

Debt to Equity ratio = Total Liabilities / Total Equity 2.16 2.09 2.04 1.94 1.94 1.95

Accounts Receivable turnover = Sales / Accounts Receivable 52.15 46.79 37.75 37.75 37.75 37.75

Days sales Outstanding ratio = 365 / A/R turnover ratio 7.00 7.80 9.67 9.67 9.67 9.67

Interest coverage ratio = E.B.I.T / Interest 1.55 2.17 2.93 2.91 2.43 2.38

Operating income = Operating income / sales 54.96% 57.18% 57.87% 57.57% 48.01% 47.10%