Cash Flow Projections

Cash Flow Projections

Create a Cash Flow projection for one year by month. Enter revenue and expenses for each month. This shows how much money a business makes or loses over a specific month. In the case of this assignment, you are seeking an additional $200,000.00 to go with your initial investment of $50,000.00 (see example documents for students).  Therefore, it is imperative that your cash flow indicate your need for the $200,000 that you are looking to get from an investor. This means that you will show accumulating deficits each month until the $200,000 becomes a visible need.

•             Opening balance sheet

•             Break-even Analysis


The projection of when the revenue will surpass the expenses of the venture is called the Break-Even point and is generally depicted graphically.

For our purposes a simple break-even analysis is required and is based upon your projected first year of operation. The formula to calculate the Break-Even Point is:  Total Fixed Cost/Contribution Margin per Unit = Break-even point in units.  Contribution Margin is total sales minus variable costs.

Fixed Costs

Selling Price – Variable costs

For the purpose of this project it is acceptable to estimate variable costs in order to determine a break-even. If you have several products with different selling prices and costs then simply take an average of them all and use the average figures to get an overall estimate of your break-even point in dollars or units. In the end all break-even will be equated to dollars.


Alternative Scenarios

For the purposes of this exercise you will provide only one case indicating clearly on your cash-flow statement the need for the $200,000 you seek from an investor.

•             Create a Cash Flow, Balance Sheet and Break-even Analysis for your business plan. 10.  Appendices:


The appendix of the Business Plan generally contains all the documents that are referred to in the plan itself and any backup material not placed in the text of the document. You might consider including the following:


•             Product/service samples

•             Market Research data

•             Legal Forms and Documents

•             Leases or contracts

•             Price lists from suppliers, if applicable

•             Promotional Material examples

•             Résumés of the Management Team

•             Other back up material