Assignment 4: Business Plan--Final

Week 7

Sources and use of funds

The main sources of funds will be revenues from Family and Friends in the amount of $20,000 with a 5% interest rate. In the first year of business, the projected revenue from the sale of the product line, $40,000 from Melinda Cates and $20,000 from another investor I hopeful the gross profit for the first year will be $80,000. The profits will be invested back in the business through purchase of production equipment and financing marketing and sales activities. Additional funds will be used on inventory and any other necessary capital purchase for production purposes.

Plan assumptions

Fresh N Fruity business plan will be based on several assumptions. The first assumption is that the economy will be strong with a positive growth in terms of GDP, inflation and disposable income such that consumers will continue to purchase Fresh N Fruity as planned. Another assumption is that there will be no major changes in the political and regulatory environment that could potentially affect the smooth operations of the.

Break-even analysis

According to revenue projections, Fresh N Fruity is expected to break even at the end of the second financial year whereby the gross profit would have accumulated to $160,000. The first year of sales is expected to generate $80,000 of gross profit, the second year $90,000 With these projections, the company should have recouped its investment capital of $160,000.

The teacher feedback

Shaquinna,

Thank you for your submission. Good start with the Excel document. Please check and adjust the following:

•Insert the income tax payments on the cash flow statement (check red triangle)

•Include the information required in the "other assets" line 23 in the balance sheet (see instructions in the guide, under Worksheet # 4). You have a number but it is not correct.

•The income statement and cash-flow statement should not be in the negative.

Please adjust for Assignment 3. Make sure your financials reflect the information you used in your business plan (assignments 1-3)

You will continue to adjust this document as you develop your Assignment 3 and as needed until you submit the final version of the business plan.

The written portion of the Financials will be included in the written portion of Assignment 4.

Keep up the good work.