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Homework 5 - Finance Plan
Finance Plan Criteria
Depending on the nature of your business, your finance plan should be 5 to 12 pages in length.
It should include (however you choose) the following elements:
1. Your request for funding
a. this should be written last, once you've studied the amounts needed
b. it should be brief and explain how you will use the money and how soon it will be repaid if
you are seeking a loan, eg. 5 year loan
2. Projected Income Statements
a. First three years
b. Include a monthly breakdown for the first year
c. You should be working from and specify in this section the cost estimates for (wages and salaries,
materials and supplies, building and land, equipment, marketing, etc.)
3. Projected Balance Sheets
a. First three years
b. Explain expected sources for funds eg. stock sale to friend or bank loan
and the interest rate for any loans
4. Break even analysis
a. Calculations and assumptions, eg. average cost per unit and price per unit
b. Number of units that must be sold to break even
c. Total sales in dollars needed to break even
You may receive bonus points if you prepare a cash flow statement for your first year,
broken down by month.
Business key words: financial plan, business plan chapter, loan, capital investor,
investments, cost, margin, overhead expenses, business operating cost, nonrecurring
cost, income statement, projections, breakeven analysis, bonus structure, balance
sheet, financial statements, finance.
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