Assignment 2: Business Plan Breakdown 3—The Simplified Financial Plan (Part 3 for the Healthy Store)

This is the third milestone of your business plan—the financial plan.

Tasks:

Research the costs, financial statements, cash flow, and risks of your chosen project. Based on your research and the knowledge you have gained from the course, create a simplified 4- page financial plan including tables and charts. For the financial plan:

  • Estimate the capital requirements, use of capital, start-up requirements (if applicable), and other probable costs involved in the implementation and subsequent operation of your project.
  • Identify the sources of financing.
  • Define a payback period.
  • Prepare cash flow projections.
  • Prepare a projected balance sheet representing the end of the first calendar year of operations and defining assets and liabilities, both current and long term.
  • Prepare income statement projections for the end of the first calendar year of operations, including charts showing gross revenues, gross profit, and net income.
  • Define the meaning of a break-even analysis and prepare an analysis appropriate for your project.
  • Prepare a ratio analysis, including the definition and value of the following ratios (whichever applicable)—current, quick, debt, debt-to-equity, average inventory turnover, receivables turnover, payables turnover, net sales to working capital, net profit to sales, and net profit to equity.
  • Prepare a list of possible risks associated with the implementation and future operation of your project and describe the significance of each of them.

Submission Details:

  • By Wednesday, April 20, 2016, save your paper as M3_A2_lastname_firstinitial.doc and submit it to the M3: Assignment 2 Dropbox.

This assignment is worth 100 points and will be graded according to the following rubric.

Assignment Components Proficient Maximum Points
Estimate capital requirements, use of capital, start-up requirements (if applicable), and other probable costs involved in the implementation and subsequent operation of your project. Estimate of capital requirements is clear, detailed, and appropriate. It includes use of capital, start-up requirements (if applicable), and other probable costs involved in the implementation and subsequent operation. 12
Identify sources of financing and define a payback period. Sources of financing identified are specific and feasible. Payback period is defined and reasonable. 8
Prepare cash flow projections. Cash flow projections are clear and allotted for both short term and long term. 12
Prepare a projected balance sheet representing the end of the first calendar year of operations, and defining assets and liabilities, both current and long term Projected balance sheet representing the end of the first calendar year of operations, defining assets and liabilities, both current and long term, are reasonable given the scope and resources of the project. 12
Prepare income statement projections for the end of the first calendar year of operations, including charts showing gross revenues, gross profit, and net income. Income statement projections for the end of the first calendar year of operations are specific and reasonable. They include charts showing gross revenues, gross profit, and net income. 12
Define the meaning of a breakeven analysis and prepare one to reflect your project. Defined breakeven analysis. Prepared breakeven analysis for project is specific and uses data to support ideas. 12
Prepare a ratio analysis, including the definition and the value of the following ratios (whenever applicable): current, quick, debt, debt to equity, average inventory turnover, receivables turnover, payables turnover, net sales to working capital, net profit to sales, and net profit to equity. Prepared a complete ratio analysis, including all ratios required and listed in the assignment component. 12
Prepare a list of possible risks associated with the implementation and future operation of your project, and provide significance for each of them. Prepared a list of possible risks associated with the implementation and future operation of your project, and provided significance for each of them. Each risk is realistic, is a genuine risk to the project, and is clearly articulated. 12
Write in a clear, concise, and organized manner; demonstrate ethical scholarship in accurate representation and attribution of sources; display accurate spelling, grammar, and punctuation. Wrote in a clear, concise, and organized manner; demonstrated ethical scholarship in accurate representation and attribution of sources; displayed accurate spelling, grammar, and punctuation. 8
Total: 100

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