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Financial Plan
Service-based businesses require little funds to start-up, and as they grow and expand, less funds to maintain.
The charts and graphs that follow will show that investment up front allows Occasions to function debt-free with
little overhead. This gives Occasions a quicker break-even point and increased profit margins from the start. As
Occasions grows, the debt-free philosophy will be maintained until it is impossible to function during growth
periods without financial assistance.

7.1 Important Assumptions

Tax rates are noted for information. We carry no loan burden that would be effected by these rates. What hits
Occasions the hardest (but not nearly are bad as other service businesses), is the tax rate of 24%, which is
nearly one quarter of the total sales. As Occasions continues to grow, these numbers will be reference rather
than influence.

General Assumptions

Year 1 Year 2 Year 3

Plan Month 1 2 3

Current Interest Rate 10.00% 10.00% 10.00%

Long-term Interest Rate 10.00% 10.00% 10.00%

Tax Rate 24.00% 24.00% 24.00%

Other 0 0 0

7.2 Key Financial Indicators

The break-even point for Occasions is based on the assumption that we will produce 22 events per month and
average approximately $521 per event. In the current situation, we average more than this assumption for our
public and private organization events. These currently make up 18 of the 22 average events hosted per month.
7.3 Break-even Analysis
The break-even point is based on the assumption that we will produce 22 events per month and average
approximately $521 per event. In the current situation, we average more than this assumption for our public and
private organization events. These currently make up 18 of the 22 average events hosted per month.

The break-even point will appear more rapidly for Occasions than for other types of home-based businesses.
Start-up costs are limited to minimal equipment, there is little or no staff to pay in the beginning, and contracted
companies will handle any additional equipment required for the planned events.

Break-even Analysis

Monthly Revenue Break-even $19,313

Assumptions:

Average Percent Variable Cost 12%

Estimated Monthly Fixed Cost $17,023

7.4 Projected Profit and Loss
Leading the industry in event planning requires the use of the resources available at the lowest cost. As noted in
the table, we spend less money on overhead than another event planners with an outside office or office space in
their own facility. This savings allows us to market in creative ways and spend funds on expansion into other
areas when the time is right.

Pro Forma Profit and Loss

Year 1 Year 2 Year 3

Sales $353,149 $494,670 $554,779

Direct Cost of Sales $41,872 $58,507 $64,299

Other Costs of Sales $196 $203 $221

Total Cost of Sales $42,068 $58,710 $64,520

Gross Margin $311,081 $435,960 $490,259

Gross Margin % 88.09% 88.13% 88.37%

Expenses

Payroll $56,044 $63,310 $66,560

Sales & Marketing & Other Expenses $146,013 $68,400 $73,400

Depreciation $0 $0 $0

Leased Equipment $0 $0 $0

Utilities $516 $750 $800

Insurance $264 $750 $1,000

Rent $1,440 $1,800 $1,800

Payroll Taxes $0 $0 $0

Other $0 $0 $0

Total Operating Expenses $204,277 $135,010 $143,560

Profit Before Interest and Taxes $106,804 $300,950 $346,699

EBITDA $106,804 $300,950 $346,699

Interest Expense $406 $279 $362

Taxes Incurred $25,535 $72,161 $83,121

Net Profit $80,862 $228,510 $263,216

Net Profit/Sales 22.90% 46.19% 47.45%

7.5 Projected Cash Flow

Our cash situation is great. Although we begin with little extra cash, our increased growth allows us to make up
for lost time. Our cash balance is always above the mark with the cash flow not too far behind. We have no
negatives in our cash analysis.

Pro Forma Cash Flow

Year 1 Year 2 Year 3

Cash Received

Cash from Operations

Cash Sales $141,260 $197,868 $221,912

Cash from Receivables $178,271 $283,330 $327,145

Subtotal Cash from Operations $319,531 $481,198 $549,057

Additional Cash Received

Sales Tax, VAT, HST/GST Received $0 $0 $0

New Current Borrowing $4,000 $1,080 $1,080

New Other Liabilities (interest-free) $0 $0 $0

New Long-term Liabilities $0 $0 $0

Sales of Other Current Assets $0 $0 $0

Sales of Long-term Assets $0 $0 $0

New Investment Received $0 $0 $0

Subtotal Cash Received $323,531 $482,278 $550,137

Expenditures Year 1 Year 2 Year 3

Expenditures from Operations

Cash Spending $56,044 $63,310 $66,560

Bill Payments $199,964 $209,268 $223,979

Subtotal Spent on Operations $256,008 $272,578 $290,539

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0

Principal Repayment of Current Borrowing $3,500 $500 $0

Other Liabilities Principal Repayment $0 $0 $0

Long-term Liabilities Principal Repayment $0 $0 $0

Purchase Other Current Assets $0 $0 $0

Purchase Long-term Assets $0 $0 $0

Dividends $0 $0 $0

Subtotal Cash Spent $259,508 $273,078 $290,539

Net Cash Flow $64,023 $209,200 $259,598

Cash Balance $66,323 $275,523 $535,121

7.6 Projected Balance Sheet

Occasions is set up for success. According to the numbers, we start out fair and end up amazing. By FY2000, we
will be worth over $125,000 with a profit margin of over 30%. We are operating with little to zero debt, boosting
the net worth even higher. Our only weakness is the products to be released in FY2000 have not been accounted
for as an investment of funds. This will effect the cash flow in a moderate way, and is undetermined how it will
effect the profit ratio of the business.

Pro Forma Balance Sheet

Year 1 Year 2 Year 3

Assets

Current Assets

Cash $66,323 $275,523 $535,121

Accounts Receivable $33,618 $47,090 $52,812

Inventory $4,991 $6,975 $7,665

Other Current Assets $0 $0 $0

Total Current Assets $104,933 $329,588 $595,598

Long-term Assets

Long-term Assets $0 $0 $0

Accumulated Depreciation $0 $0 $0

Total Long-term Assets $0 $0 $0

Total Assets $104,933 $329,588 $595,598

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities

Accounts Payable $21,270 $16,836 $18,550

Current Borrowing $2,500 $3,080 $4,160

Other Current Liabilities $0 $0 $0

Subtotal Current Liabilities $23,770 $19,916 $22,710

Long-term Liabilities $0 $0 $0

Total Liabilities $23,770 $19,916 $22,710

Paid-in Capital $3,665 $3,665 $3,665

Retained Earnings ($3,365) $77,497 $306,007

Earnings $80,862 $228,510 $263,216

Total Capital $81,162 $309,672 $572,888

Total Liabilities and Capital $104,933 $329,588 $595,598

Net Worth $81,162 $309,672 $572,888

7.7 Business Ratios

Data on our business ratios is shown in the table below. Industry Profile ratios are based on Standard Industry
Classification (SIC) Index code 7299.

Ratio Analysis

Year 1 Year 2 Year 3 Industry Profile

Sales Growth 0.00% 40.07% 12.15% 11.37%

Percent of Total Assets

Accounts Receivable 32.04% 14.29% 8.87% 10.40%

Inventory 4.76% 2.12% 1.29% 3.83%

Other Current Assets 0.00% 0.00% 0.00% 48.41%

Total Current Assets 100.00% 100.00% 100.00% 62.64%

Long-term Assets 0.00% 0.00% 0.00% 37.36%

Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 22.65% 6.04% 3.81% 23.10%

Long-term Liabilities 0.00% 0.00% 0.00% 24.97%

Total Liabilities 22.65% 6.04% 3.81% 48.07%

Net Worth 77.35% 93.96% 96.19% 51.93%

Percent of Sales

Sales 100.00% 100.00% 100.00% 100.00%

Gross Margin 88.09% 88.13% 88.37% 100.00%

Selling, General & Administrative Expenses 69.22% 35.37% 34.65% 65.24%

Advertising Expenses 0.51% 0.44% 0.47% 2.43%

Profit Before Interest and Taxes 30.24% 60.84% 62.49% 4.31%

Main Ratios

Current 4.41 16.55 26.23 1.83

Quick 4.20 16.20 25.89 1.31

Total Debt to Total Assets 22.65% 6.04% 3.81% 58.52%

Pre-tax Return on Net Worth 131.09% 97.09% 60.45% 7.33%

Pre-tax Return on Assets 101.40% 91.23% 58.15% 17.66%

Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin 22.90% 46.19% 47.45% n.a

Return on Equity 99.63% 73.79% 45.95% n.a

Activity Ratios

Accounts Receivable Turnover 6.30 6.30 6.30 n.a

Collection Days 43 50 55 n.a

Inventory Turnover 10.91 9.78 8.78 n.a

Accounts Payable Turnover 10.40 12.17 12.17 n.a

Payment Days 27 34 29 n.a

Total Asset Turnover 3.37 1.50 0.93 n.a

Debt Ratios

Debt to Net Worth 0.29 0.06 0.04 n.a

Current Liab. to Liab. 1.00 1.00 1.00 n.a

Liquidity Ratios

Net Working Capital $81,162 $309,672 $572,888 n.a

Interest Coverage 262.90 1,078.67 957.73 n.a

Additional Ratios

Assets to Sales 0.30 0.67 1.07 n.a

Current Debt/Total Assets 23% 6% 4% n.a

Acid Test 2.79 13.83 23.56 n.a

Sales/Net Worth 4.35 1.60 0.97 n.a

Dividend Payout 0.00 0.00 0.00 n.a

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Forecast Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9
Month 10 Month 11 Month 12 Sales Private 0% $12,860 $10,966 $11,435 $12,889 $13,001
$15,777 $15,998 $24,960 $26,522 $20,009 $19,650 $22,103 Public 0% $3,852 $7,884
$7,200 $8,965 $8,566 $7,600 $9,705 $11,245 $11,780 $11,999 $12,300 $12,089 Other 0%
$800 $955 $900 $1,190 $2,450 $2,133 $2,100 $4,656 $4,500 $4,622 $4,800 $4,688 Total
Sales $17,512 $19,805 $19,535 $23,044 $24,017 $25,510 $27,803 $40,861 $42,802
$36,630 $36,750 $38,880 Direct Cost of Sales Month 1 Month 2 Month 3 Month 4 Month 5
Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Private $1,800 $1,535
$1,601 $1,804 $1,820 $2,209 $2,240 $3,494 $3,713 $2,801 $2,751 $3,094 Public $385
$788 $720 $897 $857 $760 $971 $1,125 $1,178 $1,200 $1,230 $1,209 Other $40 $48 $45
$60 $123 $107 $105 $233 $225 $231 $240 $234 Subtotal Direct Cost of Sales $2,226
$2,371 $2,366 $2,760 $2,799 $3,075 $3,315 $4,852 $5,116 $4,232 $4,221 $4,538
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Personnel Plan
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Event Specialist 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Site Manager 0% $735 $907 $735 $735 $735 $735 $1,245 $1,400 $1,245 $875 $875 $875
Other 0% $586 $800 $586 $586 $586 $586 $844 $895 $844 $844 $895 $895
Total People 0 0 0 0 0 0 0 0 0 0 0 0
Total Payroll $4,321 $4,707 $4,321 $4,321 $4,321 $4,321 $5,089 $5,295 $5,089 $4,719 $4,770 $4,770

Pro Forma Profit and Loss

Month
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11
12
Sales $17,512 $19,805 $19,535 $23,044 $24,017 $25,510 $27,803 $40,861 $42,802 $36,630 $36,750 $38,880
Direct Cost of Sales $2,226 $2,371 $2,366 $2,760 $2,799 $3,075 $3,315 $4,852 $5,116 $4,232 $4,221 $4,538
Other Costs of Sales $15 $13 $15 $16 $16 $16 $19 $22 $22 $13 $15 $14
Total Cost of Sales $2,241 $2,384 $2,381 $2,776 $2,815 $3,091 $3,334 $4,874 $5,138 $4,245 $4,236 $4,552
Gross Margin $15,271 $17,421 $17,154 $20,268 $21,202 $22,419 $24,469 $35,987 $37,664 $32,385 $32,514 $34,328
Gross Margin % 87.21% 87.96% 87.81% 87.95% 88.28% 87.88% 88.01% 88.07% 88.00% 88.41% 88.47% 88.29%
Expenses
Payroll $4,321 $4,707 $4,321 $4,321 $4,321 $4,321 $5,089 $5,295 $5,089 $4,719 $4,770 $4,770
Sales & Marketing &
$9,015 $10,748 $9,982 $10,260 $10,315 $10,415 $12,418 $18,015 $16,615 $13,290 $11,975 $12,965
Other Expenses
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Leased Equipment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $43 $43 $43 $43 $43 $43 $43 $43 $43 $43 $43 $43
Insurance $22 $22 $22 $22 $22 $22 $22 $22 $22 $22 $22 $22
Rent $120 $120 $120 $120 $120 $120 $120 $120 $120 $120 $120 $120
Payroll Taxes 12% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Operating Expenses $13,521 $15,640 $14,488 $14,766 $14,821 $14,921 $17,692 $23,495 $21,889 $18,194 $16,930 $17,920
Profit Before Interest and
$1,750 $1,781 $2,666 $5,502 $6,381 $7,498 $6,777 $12,492 $15,775 $14,191 $15,584 $16,408
Taxes
EBITDA $1,750 $1,781 $2,666 $5,502 $6,381 $7,498 $6,777 $12,492 $15,775 $14,191 $15,584 $16,408
Interest Expense $17 $50 $47 $44 $41 $38 $35 $33 $30 $27 $24 $21
Taxes Incurred $416 $415 $629 $1,310 $1,521 $1,790 $1,618 $2,990 $3,779 $3,399 $3,734 $3,933
Net Profit $1,318 $1,315 $1,990 $4,148 $4,818 $5,669 $5,123 $9,469 $11,966 $10,765 $11,826 $12,454
Net Profit/Sales 7.52% 6.64% 10.19% 18.00% 20.06% 22.22% 18.43% 23.17% 27.96% 29.39% 32.18% 32.03%

Pro Forma Cash Flow

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Cash Received
Cash from Operations
Cash Sales $7,005 $7,922 $7,814 $9,218 $9,607 $10,204 $11,121 $16,344 $17,121 $14,652 $14,700 $15,552
Cash from Receivables $0 $5,604 $11,241 $11,797 $12,844 $14,138 $14,888 $16,040 $20,860 $25,138 $23,706 $22,016
Subtotal Cash from Operations $7,005 $13,526 $19,055 $21,014 $22,451 $24,342 $26,009 $32,384 $37,981 $39,790 $38,406 $37,568
Additional Cash Received
Sales Tax, VAT, HST/GST
0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Received
New Current Borrowing $0 $4,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Other Liabilities (interest-
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
free)
New Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Investment Received $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $7,005 $17,526 $19,055 $21,014 $22,451 $24,342 $26,009 $32,384 $37,981 $39,790 $38,406 $37,568
Expenditures Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Expenditures from Operations
Cash Spending $4,321 $4,707 $4,321 $4,321 $4,321 $4,321 $5,089 $5,295 $5,089 $4,719 $4,770 $4,770
Bill Payments $477 $14,309 $13,919 $13,277 $15,006 $14,951 $15,891 $18,185 $27,728 $25,842 $20,173 $20,204
Subtotal Spent on Operations $4,798 $19,016 $18,240 $17,598 $19,327 $19,272 $20,980 $23,480 $32,817 $30,561 $24,943 $24,974
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Out
Principal Repayment of Current
$0 $0 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350
Borrowing
Other Liabilities Principal
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Repayment
Long-term Liabilities Principal
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Repayment
Purchase Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Purchase Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Spent $4,798 $19,016 $18,590 $17,948 $19,677 $19,622 $21,330 $23,830 $33,167 $30,911 $25,293 $25,324
Net Cash Flow $2,206 ($1,490) $465 $3,066 $2,773 $4,720 $4,679 $8,554 $4,814 $8,879 $13,113 $12,245
Cash Balance $4,506 $3,016 $3,481 $6,547 $9,321 $14,041 $18,719 $27,273 $32,087 $40,966 $54,079 $66,323

Pro Forma Balance Sheet

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Starting
Assets
Balances
Current Assets
Cash $2,300 $4,506 $3,016 $3,481 $6,547 $9,321 $14,041 $18,719 $27,273 $32,087 $40,966 $54,079 $66,323
Accounts Receivable $0 $10,507 $16,786 $17,266 $19,296 $20,863 $22,031 $23,825 $32,301 $37,122 $33,963 $32,306 $33,618
Inventory $0 $2,448 $2,609 $2,602 $3,037 $3,079 $3,383 $3,647 $5,337 $5,628 $4,655 $4,643 $4,991
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $2,300 $17,462 $22,411 $23,350 $28,880 $33,262 $39,454 $46,191 $64,911 $74,837 $79,584 $91,028 $104,933
Long-term Assets
Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Assets $2,300 $17,462 $22,411 $23,350 $28,880 $33,262 $39,454 $46,191 $64,911 $74,837 $79,584 $91,028 $104,933
Liabilities and Capital Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Current Liabilities
Accounts Payable $0 $13,844 $13,478 $12,777 $14,509 $14,423 $15,296 $17,259 $26,860 $25,169 $19,502 $19,470 $21,270
Current Borrowing $2,000 $2,000 $6,000 $5,650 $5,300 $4,950 $4,600 $4,250 $3,900 $3,550 $3,200 $2,850 $2,500
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Current Liabilities $2,000 $15,844 $19,478 $18,427 $19,809 $19,373 $19,896 $21,509 $30,760 $28,719 $22,702 $22,320 $23,770
Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Liabilities $2,000 $15,844 $19,478 $18,427 $19,809 $19,373 $19,896 $21,509 $30,760 $28,719 $22,702 $22,320 $23,770
Paid-in Capital $3,665 $3,665 $3,665 $3,665 $3,665 $3,665 $3,665 $3,665 $3,665 $3,665 $3,665 $3,665 $3,665
Retained Earnings ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365) ($3,365)
Earnings $0 $1,318 $2,633 $4,623 $8,771 $13,589 $19,258 $24,381 $33,851 $45,817 $56,582 $68,408 $80,862
Total Capital $300 $1,618 $2,933 $4,923 $9,071 $13,889 $19,558 $24,681 $34,151 $46,117 $56,882 $68,708 $81,162
Total Liabilities and Capital $2,300 $17,462 $22,411 $23,350 $28,880 $33,262 $39,454 $46,191 $64,911 $74,837 $79,584 $91,028 $104,933
Net Worth $300 $1,618 $2,933 $4,923 $9,071 $13,889 $19,558 $24,681 $34,151 $46,117 $56,882 $68,708 $81,162

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