aCCOUNTING HELP
SBE 440
Week 6 Assignment
| Pro Forma Cash Flow | |||
| Year 1 | Year 2 | ||
| Cash Received | |||
| Cash from Operations | |||
| Cash Sales | $180,920 | $200,230 | |
| Cash from Receivables | $14,635 | $19,636 | |
| Subtotal Cash from Operations | $195,555 | $219,867 | |
| Additional Cash Received | |||
| Sales Tax, VAT, HST/GST Received | $0 | $0 | |
| New Current Borrowing | $0 | $0 | |
| New Other Liabilities (interest-free) | $0 | $0 | |
| New Long-term Liabilities | $0 | $0 | |
| Sales of Other Current Assets | $0 | $0 | |
| Sales of Long-term Assets | $0 | $0 | |
| New Investment Received | $0 | $0 | |
| Subtotal Cash Received | $195,555 | $219,867 | |
| Expenditures | Year 1 | Year 2 | |
| Expenditures from Operations | |||
| Cash Spending | $93,300 | $102,000 | |
| Bill Payments | $77,017 | $86,232 | |
| Subtotal Spent on Operations | $170,317 | $188,232 | |
| Additional Cash Spent | |||
| Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | |
| Principal Repayment of Current Borrowing | $0 | $0 | |
| Other Liabilities Principal Repayment | $0 | $0 | |
| Long-term Liabilities Principal Repayment | $2,000 | $2,000 | |
| Purchase Other Current Assets | $0 | $0 | |
| Purchase Long-term Assets | $0 | $0 | |
| Dividends | $0 | $0 | |
| Subtotal Cash Spent | $172,317 | $190,232 | |
| Net Cash Flow | $23,238 | $29,634 | |
| Cash Balance | $25,238 | $35,773 | |
Exit Plan Strategy
Every business needs to have an exit strategy, because of the unknowns of the future. An exit strategy is also important to the bank as a plan to retire the debt incurred at start-up. The desirability of each strategy is dependent on the mix of ownership, original intent, market conditions and company performance. My desire is to keep the company because of its stability and steady revenue stream. As the owner I will look for someone else I can trust to take over, while I use the remaining cash to develop my next great idea.
