Sales Forecasting

2014 Total 2015 2016 2017 2018
Revenue & Expenses January February March April May June July August September October November December
Sales Unit 4,000 6,000 7,000 8,000 10,000 10,000 45,000 380,000 1,425,000 2,250,000 3,162,500
Regular Version (75%) 3,000 4,500 5,250 6,000 7,500 7,500 33,750 285,000 1,068,750 1,687,500 2,371,875
Premium Version (25%) 1,000 1,500 1,750 2,000 2,500 2,500 11,250 95,000 356,250 562,500 790,625
Regular Price $1.99 5,970 8,955 10,448 11,940 14,925 14,925 67,163 567,150 2,126,813 3,358,125 4,720,031
Premium Price $4.99 4,990 7,485 8,733 9,980 12,475 12,475 56,138 474,050 1,777,688 2,806,875 3,945,219
Total Revenue From Sales 10,960 16,440 19,180 21,920 27,400 27,400 123,300 1,041,200 3,904,500 6,165,000 8,665,250
Coins Purchase 2,740.0 4,110.0 4,795.0 5,480.0 6,850.0 6,850.0 30,825.0 260,300.0 976,125.0 1,541,250.0 2,166,312.5
Assumptions
Advertising Earnings Growth 25%
Subscription growth 15%
Marketing Expense 10%
Transaction Cost 3%
Tax Rate 30%
Interest Rate 12%
Interest Expense $24,000

Revenue and Expenses

2014 Total 2015 2016 2017 2018
Revenue & Expenses January February March April May June July August September October November December
REVENUE (Sales): $0 $0 $0 $0 $0 $0 $10,960 $16,440 $19,180 $21,920 $27,400 $27,400 $123,300 $1,041,200 $3,904,500 $6,165,000 $8,665,250
Coins Purchase $0 $0 $0 $0 $0 $0 $2,740 $4,110 $4,795 $5,480 $6,850 $6,850 $30,825 $260,300 $976,125 $1,541,250 $2,166,313
Advertising $500 $1,000 $1,500 $2,500 $3,500 $5,000 $14,000 $17,500 $21,875 $27,344 $34,180
Subscription Fee $150 $350 $500 $750 $1,000 $1,150 $3,900 $4,485 $5,158 $5,931 $6,821
Total Revenue $0 $0 $0 $0 $0 $0 $14,350 $21,900 $25,975 $30,650 $38,750 $40,400 $172,025 $1,323,485 $4,907,658 $7,739,525 $10,872,563
OPERATING EXPENSES:
Salary Expenses 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 420000 500000 550000 650000 800000
Maitenance Expenses 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 22000 24000 24000 24000 24000
Marketing Expenses 1500 $1,435 $2,190 $2,598 $3,065 $3,875 $4,040 $17,203 $132,349 $490,766 $773,953 $1,087,256
Legal Expenses 1500 3000 4500
Adminstrative Expenses 500 1000 1000 1000 1000 1000 3500 3500 3500 3500 3500 3500 26500 42000 45000 50000 65000
Utilities 300 300 300 300 300 300 300 300 300 300 300 300 3600 3600 3600 4000 5000
Transaction Cost (Payment) $431 $657 $779 $920 $1,163 $1,212 $5,161 $39,705 $147,230 $232,186 $326,177
Total Expenses 37300 41300 38300 38300 38300 39800 42665.5 43647 44176.75 44784.5 45837.5 46052 498963.25 741653.05 1260595.5075 1734138.271125 2307433.23054375
Earnings Before Interest and Tax -$37,300 -$41,300 -$38,300 -$38,300 -$38,300 -$39,800 -$28,316 -$21,747 -$18,202 -$14,135 -$7,088 -$5,652 -$326,938 $581,832 $3,647,062 $6,005,387 $8,565,130
Interest Expense 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000 24000 24000 24000 24000
Earnings Before Tax -$39,300 -$43,300 -$40,300 -$40,300 -$40,300 -$41,800 -$30,316 -$23,747 -$20,202 -$16,135 -$9,088 -$7,652 -$350,938 $557,832 $3,623,062 $5,981,387 $8,541,130
Tax Expense -$11,790 -$12,990 -$12,090 -$12,090 -$12,090 -$12,540 -$9,095 -$7,124 -$6,061 -$4,840 -$2,726 -$2,296 -$105,281 $167,350 $1,086,919 $1,794,416 $2,562,339
Net Income -$27,510 -$30,310 -$28,210 -$28,210 -$28,210 -$29,260 -$21,221 -$16,623 -$14,141 -$11,294 -$6,361 -$5,356 -$245,657 $390,482 $2,536,144 $4,186,971 $5,978,791

Forecasted Balance Sheet

2014 2015 2016 2017 2018
ASSETS:
Current Assets:
Cash $ (245,657) $ 290,482 $ 2,036,144 $ 2,986,971 $ 3,478,791
Office Equipment $ 100,000 $ 90,000 $ 75,000 $ 65,000 $ 60,000
Long Term Assets:
Application Value $ 500,000 $ 510,000 $ 525,000 $ 535,000 $ 540,000
Total Assets $ 354,343 $ 890,482 $ 2,636,144 $ 3,586,971 $ 4,078,791
LIABILITIES:
Current Liabilties:
Salaries Payables
Long Term Liabilities:
Loans $ 200,000.00 $ 200,000.00 $ 200,000.00 $ 200,000.00 $ 200,000.00
Total Liabilities $ 200,000.00 $ 200,000.00 $ 200,000.00 $ 200,000.00 $ 200,000.00
Owner's Equity
Equity Investment $ 400,000.00 $ 400,000.00 $ 400,000.00 $ 400,000.00 $ 400,000.00
Retain Earnings -$245,657 $290,482 $2,036,144 $2,986,971 $3,478,791
Total Liabilities and
Owner's Equity $ 354,343 $ 890,482 $ 2,636,144 $ 3,586,971 $ 4,078,791
Statement of Retain Earnings
2014 2015 2016 2017 2018
Beginning Reatin Earnings
Net Income -$245,657 $390,482 $2,536,144 $4,186,971 $5,978,791
Dividends 0 100,000 500,000 1,200,000 2,500,000
Ending Retain Earnings -$245,657 $290,482 $2,036,144 $2,986,971 $3,478,791

Financial Statements and Projections

Financial Assumptions

Revenue and Cost Estimate

As it would take at least 6 months to market our first app so we have forecasted revenue for the last 6 months of the first year only. Below is the forecasting:

page 1

Forecasted Profit and Loss Statement

Financial Projections

Summarize the financial projections and the assumption used in estimating the projections in section F

Break Even Analysis

Financial Position

Capital Needs

Income Statements:

Total

Revenue & ExpensesJanuary FebruaryMarchAprilMay JuneJuly AugustSeptemberOctober November December

REVENUE (Sales):$0$0$0$0$0$0$10,960$16,440$19,180$21,920$27,400$27,400$123,300

Coins Purchase$0$0$0$0$0$0$2,740$4,110$4,795$5,480$6,850$6,850$30,825

Advertising$500$1,000$1,500$2,500$3,500$5,000$14,000

Subscription Fee$150$350$500$750$1,000$1,150$3,900

Total Revenue$0$0$0$0$0$0$14,350$21,900$25,975$30,650$38,750$40,400$172,025

OPERATING EXPENSES:

Salary Expenses350003500035000350003500035000350003500035000350003500035000420000

Maintenance Expenses2000200020002000200020002000200020002000200022000

Marketing Expenses1500$1,435$2,190$2,598$3,065$3,875$4,040$17,203

Legal Expenses150030004500

Administrative Expenses5001000100010001000100035003500350035003500350026500

Utilities3003003003003003003003003003003003003600

Transaction Cost (Payment)$431$657$779$920$1,163$1,212$5,161

2014

Sheet1

Income Statements:
2014 Total
Revenue & Expenses January February March April May June July August September October November December
REVENUE (Sales): $0 $0 $0 $0 $0 $0 $10,960 $16,440 $19,180 $21,920 $27,400 $27,400 $123,300
Coins Purchase $0 $0 $0 $0 $0 $0 $2,740 $4,110 $4,795 $5,480 $6,850 $6,850 $30,825
Advertising $500 $1,000 $1,500 $2,500 $3,500 $5,000 $14,000
Subscription Fee $150 $350 $500 $750 $1,000 $1,150 $3,900
Total Revenue $0 $0 $0 $0 $0 $0 $14,350 $21,900 $25,975 $30,650 $38,750 $40,400 $172,025
OPERATING EXPENSES:
Salary Expenses 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 35000 420000
Maintenance Expenses 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 22000
Marketing Expenses 1500 $1,435 $2,190 $2,598 $3,065 $3,875 $4,040 $17,203
Legal Expenses 1500 3000 4500
Administrative Expenses 500 1000 1000 1000 1000 1000 3500 3500 3500 3500 3500 3500 26500
Utilities 300 300 300 300 300 300 300 300 300 300 300 300 3600
Transaction Cost (Payment) $431 $657 $779 $920 $1,163 $1,212 $5,161
Total Expenses 37300 41300 38300 38300 38300 39800 42665.5 43647 44176.75 44784.5 45837.5 46052 498963.25
Earnings Before Interest and Tax ($37,300) ($41,300) ($38,300) ($38,300) ($38,300) ($39,800) ($28,316) ($21,747) ($18,202) ($14,135) ($7,088) ($5,652) ($326,938)
Interest Expense 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
Earnings Before Tax ($39,300) ($43,300) ($40,300) ($40,300) ($40,300) ($41,800) ($30,316) ($23,747) ($20,202) ($16,135) ($9,088) ($7,652) ($350,938)
Tax Expense ($11,790) ($12,990) ($12,090) ($12,090) ($12,090) ($12,540) ($9,095) ($7,124) ($6,061) ($4,840) ($2,726) ($2,296) ($105,281)
Net Income ($27,510) ($30,310) ($28,210) ($28,210) ($28,210) ($29,260) ($21,221) ($16,623) ($14,141) ($11,294) ($6,361) ($5,356) ($245,657)

 ParticularsAmount

ASSETS:

Current Assets:

Cash($245,657)

Other Current Assets$100,000

Long Term Assets:

Office Equipments$500,000

Total Assets$354,343

LIABILITIES:

Current Liabilities:

Salaries Payables

Long Term Liabilities:

Loans$200,000.00

Total Liabilities $200,000.00

Owner's Equity

Equity Investment$400,000.00

Retain Earnings($245,657)

Total Liabilities and

Owner's Equity

$354,343

Balance Sheet: For the year ended, 2014

Sheet1

Balance Sheet: For the year ended, 2014
 Particulars Amount
ASSETS:
Current Assets:
Cash ($245,657)
Other Current Assets $100,000
Long Term Assets:
Office Equipments $500,000
Total Assets $354,343
LIABILITIES:
Current Liabilities:
Salaries Payables
Long Term Liabilities:
Loans $200,000.00
Total Liabilities $200,000.00
Owner's Equity
Equity Investment $400,000.00
Retain Earnings ($245,657)
Total Liabilities and Owner's Equity $354,343

Fixed Cost$500,000

Price (Average)$2.74

Variable Cost$1,308,557

Sales Average1,452,500

VC per APP$0.90

Break-Even Unit271,872

Break-Even Analysis

Sheet1

Break-Even Analysis
Fixed Cost $500,000
Price (Average) $2.74
Variable Cost $1,308,557
Sales Average 1,452,500
VC per APP $0.90
Break-Even Unit 271,872

Equity Capital$400,000

Debt Capital (Loan @ 12%)$200,000

Total Investments$600,000

Capital Requirements

Sheet1

Capital Requirements
Equity Capital $400,000
Debt Capital (Loan @ 12%) $200,000
Total Investments $600,000

Advertising Earnings Growth25%

Subscription growth15%

Marketing Expense10%

Transaction Cost3%

Tax Rate30%

Interest Rate12%

Interest Expense$24,000

Financial Assumptions

Sheet1

Financial Assumptions
Advertising Earnings Growth 25%
Subscription growth 15%
Marketing Expense 10%
Transaction Cost 3%
Tax Rate 30%
Interest Rate 12%
Interest Expense $24,000

Total

Sales projectionJanuary FebruaryMarchAprilMay JuneJuly AugustSeptemberOctober November December

Sales Unit4,0006,0007,0008,00010,00010,00045,000

Regular Version (75%)3,0004,5005,2506,0007,5007,50033,750

Premium Version (25%)1,0001,5001,7502,0002,5002,50011,250

Regular Price $1.995,9708,95510,44811,94014,92514,92567,163

Premium Price $4.994,9907,4858,7339,98012,47512,47556,138

Total Revenue From Sales10,96016,44019,18021,92027,40027,400123,300

2014

Sheet1

2014 Total
Sales projection January February March April May June July August September October November December
Sales Unit 4,000 6,000 7,000 8,000 10,000 10,000 45,000
Regular Version (75%) 3,000 4,500 5,250 6,000 7,500 7,500 33,750
Premium Version (25%) 1,000 1,500 1,750 2,000 2,500 2,500 11,250
Regular Price $1.99 5,970 8,955 10,448 11,940 14,925 14,925 67,163
Premium Price $4.99 4,990 7,485 8,733 9,980 12,475 12,475 56,138
Total Revenue From Sales 10,960 16,440 19,180 21,920 27,400 27,400 123,300
Coins Purchase 2,740.00 4,110.00 4,795.00 5,480.00 6,850.00 6,850.00 30,825.00

Financial Statements and Projections

(3-5 pages) – Develop projected financial statements for the first year of business. You may use the Business Plan Financials Template to prepare this section (see Appendix B) or you may create your own template.

Revenue and Cost Estimate

This is the first part of the profit and loss statement. You will estimate the revenue (sales) and expenses for the first 12 months of your business.

Forecasted Profit and Loss Statement

(Month by month for 1st 12 months)– Here you will consider the sales forecast, the operating expenses, and the profits. Take the month-by-month revenue estimates of sales and expenses from the revenue and cost estimate (F1) and include interest expense to obtain a profit projection for your first year of operations. It will reveal net profit (obtained from subtracting the interest expense from the profit before interest). The profit before interest is calculated by subtracting total expenses from total revenue.

Salary expenses

Payroll expenses

General and administrative

Repairs and maintenance

Marketing and Advertising

Accounting and legal

Utilities

Insurance

Taxes (real estate, etc.)

Selling Expenses

Other expenses (specify)

Examples of expenses may include:

Forecasted Balance Sheet

This statement deals with cash and income and also with assets, liabilities, and capital. The balance should result in the debit and credit balances ending up equal.

Financial Projections

(1-2 pages)- Summarize the financial projections and the assumption used in estimating the projections in section F.

Breakeven Point-

Include an estimate of income and expenses. It determines whether or not your business will bring in enough money to meet its costs.

This method is used to determine the exact point at which the business makes neither takes a loss nor makes a profit. It is calculated at a point where sales have grown at a greater rate than costs and the two lines cross.

Image from book

Financial Position:

Include the estimated financial position of the company at the end of the first year and the estimated capital/investment needs. Make sure to include any assumptions you used in estimating this information.

Capital/Investment Needs:

Estimate the capital and investment needs for your company. Be sure to discuss any equity contributions your company will need along with other start up costs required.

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