Restaurant Financial Analysis

This assignment presents a detailed financial plan for a new restaurant. It includes calculations for fixed and variable expenses, breakeven sales, net income projections over five years, and cumulative income analysis. The document also explores the concept of positive cash flow and determines the break-even year based on both undiscounted and actual break-even periods.

Running head: BUSINESS PLAN
Business Plan
[Mark’s Restaurant and Lounge]
Name of the Student
Name of the University
Author Note

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Table of Contents
1.0: Executive summary..................................................................................................................3
2.0: Company Summary..................................................................................................................4
2.1: Company Ownership............................................................................................................5
2.2: Start-up Summary.................................................................................................................5
2.3: Mission.................................................................................................................................6
2.4: Objectives.............................................................................................................................7
2.5: Keys to Success....................................................................................................................7
3.0: Services.....................................................................................................................................8
3.1: Pricing and profitability........................................................................................................9
4.0: Market analysis.........................................................................................................................9
4.1: Market segmentation..........................................................................................................10
4.2: Strategy for market segment...............................................................................................11
4.3: Strategy and implementation..............................................................................................11
4.4: Competitive edge................................................................................................................12
5.0: Competitors............................................................................................................................13
6.0: Marketing strategy..................................................................................................................14
6.1: Marketing program.............................................................................................................15
6.2: Local marketing..................................................................................................................16
7.0: Sales strategy..........................................................................................................................16

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7.1: Sales forecast......................................................................................................................16
8.0: Web plan summary.................................................................................................................17
9.0: Management summary...........................................................................................................17
9.1: Management team...............................................................................................................18
9.2: Personnel plan.....................................................................................................................18
10.0: Financial plan.......................................................................................................................18
10.1: Profit and Loss Statement for the company......................................................................19
10.2: Balance Sheet for the company........................................................................................20
10.3: Cash Flow Statement........................................................................................................21
11.0: Appendices...........................................................................................................................23
11.1: Appendix 1.......................................................................................................................23
11.2: Appendix 2.......................................................................................................................23

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1.0: Executive summary
Mark’s restaurant and lounge will be a restaurant that will have a capacity of 50 in the restaurant
where as the lounge can handle almost 25 people. The main focus of the company will be on the
menu that will be traditional North American and Swedish with a hint of influence from Asia.
The company will be located in the recently constructed Palm Jumeirah, which is a man-made
island and consists of many high rise apartments.
The future of the place is promising, as there are many first-class projects that are being
developed in the area. There are many apartments along with condos, which will help the
restaurant in running successfully over the whole year. The space will be friendly and will help
in providing excellent quality of food. The restaurant will also house a fine dining place along
with a lounge so that it can attract the customers who are looking for a new experience in dining.
The lounge will consist of comfortable couches with antique seats so that it can provide the
customers the warmth and cozy atmosphere as well. The restaurant will consist of the menu that
is inspired from various countries so that it can attract diverse customers. The Swedish delicacies
will consist of meatballs, gravlax and herring along with a Asian style chicken, black bean sauce,
tofu and spinach.
The entrée dishes will consist of an American meal as well such as baked beans and barbecued
ribs of beef. The menu will be changed after a period of 4 months so that new specialties can be
provided to the customers and will be in competition with the other restaurants that are present in
the area as well.

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The restaurant will be open on all the days and attractive night themes will be done so that it can
attract the new customers. The use of soft music, warm colors and better levels of artwork from
aspiring artists will help in developing a better sense within the community so that it can help in
catering to the various needs of the customers.
The services that will be provided will be done in a friendly manner by hiring the best people and
providing them with training. The training facilities will help in encouraging and motivating the
employees to serve the customers in an efficient manner. The team of management within the
company will consist of people who have more than 10 years of experience in the field of
restaurant and catering along with marketing and finance.
One of the important parts of the business will be the catering services and the business will be in
a partnership with the Sam Catering Agency, which has its own set of clients. They have years of
experience in setting up events and birthday parties so that it can be memorable to the customers.
The total allocation of sales in the restaurant and catering will be 85 and 15 percent respectively.
2.0: Company Summary
Mark’s Restaurant and Lounge will consist of a North-American and Swedish influence
menu along with a hint of the Asian spices within a cozy environment. The choice of the menu is
that it will deal with the specialties of the various cuisines so that it can attract a large number of
customers. The restaurant will offer lunch and dinner on a fixed menu apart from the regular
items that are listed on the menu.
The restaurant will be opened everyday of the week and lunch will be served between
11:00 AM to 3:00 PM and dinner will be available from 6:00 PM to 11:00 PM on all days. The
restaurant will also host brunch on Sundays between 12 AM- 3 PM. The restaurant will also host

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many paintings from new artists so that they can get a platform for show casing their talents so
that it can help in providing a friendly atmosphere within the community.
The company will also have special evenings for Wine Tastings along with a proper meal
set so that it can help the community in acquiring a taste in the delicacies and communicate with
each other in a proper manner.
2.1: Company Ownership
The company will be formed by taking up a loan of an amount of $115,000 at a rate of 7
percent as interest. Additional $60,000 will be used as capital that will be provided by the
entrepreneur and a further amount of $125,000 will be raised from the potential investors who
want to be in partnership with the company. The company will maintain a conservative policy
with respect to the philosophy of the investors, as most of the start-ups of the restaurants are
speculative in nature. The investors of the company will be provided with a generous amount of
returns while maintaining an efficient flow of cash for the operation of the business.
2.2: Start-up Summary
The company will be established by Mark Thompson along with his friend Thomas
Friedrich. Mark will be responsible for looking after the affairs of employees and handle the
kitchen as well where as Thomas will look after the financial issues of the company. The
company will be scheduled to open in May 2018.
The company will be opened up by investing a personal capital of $60,000 along with a
loan of $115,000 and funding of $125,000 from the investors, as the capital that will be required
for starting the company. The total cost of the start-up is $300,000, which will be used for

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purchasing necessary furniture and equipment along with acquiring the liquor license and
operating cash for the next 5 months.
Summary Statement
Sources of Capital
Owners' and Other Investments
$
185,000
Bank Loans 115,000
Other Loans -
Total Source of Funds
$
300,000
Startup Expenses
Bldgs / Real Estate
$
20,000
Leasehold Improvements 10,000
Capital Equipment 75,000
Location / Admin Expenses 20,000
Opening Inventory -
Advertising / Promo Expenses 45,000
Other Expenses -
Total Startup Expenses
$
170,000
2.3: Mission
The company will be offering one of the best places to eat along with a nice atmosphere
so that the customers can be attracted towards the food joint. The primary mission of the
company is that it will offer the customers a better experience with food and the service of the
employees will be friendly in nature. The company wants to become the primary choice of both

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the genders single or with families so that the profit margin can be increased. The employees
along with the customers will be treated in a fair manner so that it can help in the overall success
of the employees.
The menu will consist of different varieties of food and will provide a nice ambiance to
the customers so that the goals of the company can be achieved within the stipulated time. They
will also provide a fine dining experience to the customers so that the profit can be earned in a
fair manner.
2.4: Objectives
The primary objectives for the company within the first three years of operations are as
follows:
 The cost of the food will be kept under the range of 35 percent of the total revenue
 The cost of labor will be in the range of 2 percent of the revenue
 The restaurant will try to be small so that the quality of service can be improved
 The sales on an average basis for the company will be between the range of $68,000-
70,000 in an year
 Promotion of Sam’s Catering Agency in and around the cities of United Arab Emirates
2.5: Keys to Success
 The quality of the food that will be offered will be good along with a friendly and
efficient service quality
 The unique atmosphere that will be made within the restaurant will help them to be
different from the competitors, which will also help in attracting the customers

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 The menu will consist of varied options so that it can serve to the different taste and
preferences of a large number of customers
 Themed nights will be made such as dinners with wine tasting, Swedish Midsummer
party and Swedish smörgåsbord
 Cost controlling at a continuous manner so that profits can be high
 Sam’s Catering Agency also has a vast list of established clients
3.0: Services
The restaurant will be serving food that is creative in nature and are of international
quality. The service that will be provided by the staffs will make the customers feel special,
which will help in enhancing the sale of the dishes. The menu of the company will be changed
after a period of 3 months so that the tastes and preferences of the customers can be changed as
well. The dishes will consist of sizeable amount of food and will be presented in a proper
manner.
The wines will be imported mainly from Argentina, New Zealand, California and France
and a sizeable portion will be served to the customers. Almost 30 percent of the wines can be
ordered by the customers through glasses where as the remaining has to be bought by a bottle.
The restaurant will also consist of a wide array of beers so that the customers can choose their
personal favorites. The lounge will be lit in a dim manner so that they can enjoy the drinks with
their companions in a cozy manner.
In the summer months the patio of the restaurants will be used for making seating
arrangements for the customers, as they would like to enjoy their food and drinks on the outer
area of the restaurant. The menu will consist of special summer items, which can make the

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customers feel light and the atmosphere will be casual in nature. The staffs of the restaurant will
be provided with the best training in culinary skills so that it can help them in serving the
customers with the food in an effective manner.
3.1: Pricing and profitability
The total sales of the restaurant has been allocated to 85 percent where as the proceeds
from the catering services will be 15 percent. The cost of sales on combining these will be 33
percent and the gross profit will be 67 percent of the total sales. The prices will be set in a
competitive manner so that it can help the restaurant in gaining a competitive advantage over the
rival restaurants that are present within the area and helps in attracting the customers as well.
4.0: Market analysis
The restaurant will try to seek the local people as well as the people who are visiting the
area as tourists and people who have a good taste in food and drinks and enjoy a nice ambience.
The restaurant will be situated in the area of Palm Jumeirah, as it is being developed at a faster
rate. The new restaurant will help in developing the place, as it will help in attracting the local
community as well as large number of foreigners who are visiting the area.
Since the place is being developed at a faster pace, it will help the restaurant in attracting
more number of customers, as the place consists of residential buildings as well as tourist spots.
The tourists can enjoy an oceanic view, which will help them in being attracted towards the
restaurant. After the project has been developed in the place, it will help in increasing the influx
of residents in the area. The city will be offering many areas for the tourists, which will help
them in being attracted towards the place. The atmosphere of the restaurant will also help in
grabbing the attention of the community and the tourists. The fine dining within the restaurant

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along with the friendly atmosphere of the staffs will help the restaurant in increasing its level of
profits. The restaurant will also offer different combinations to the customers so that they can
have an excellent experience with respect to the food.
4.1: Market segmentation
The restaurant will try to attract a wider group of people by providing them a fine dining
experience. The customers will feel relaxed and comfortable within the atmosphere and will have
an opportunity to experience the different types of food that are present in the menu. The
following segments will be considered as the target market for the restaurant:
Business man- These people can come to the restaurant after a hard day at the office so that they
can relax and enjoy with food and drinks. The business men can also have a meeting in the
restaurant, as there will be space to accommodate them as well. after the business meeting is
done, they can enjoy with food and drinks as well.
Couples- The ambience of the restaurant will be cozy and romantic, which will help in providing
enough space for the couples to enjoy their food and drinks in a relaxed manner. The couples can
also reserve the tables prior to one day so that they can enjoy a date between them. These people
will not be spending much on the drinks due to their financial constraints but can enjoy the food
that is present in the menu.
Family- The restaurant will be a perfect place for setting up of family dinner due to the service of
the staffs that will be friendly in nature and the choice of the menu. The family members will be
interested in the menu, as the price that will be spent on the food will help them in satisfying
their hunger.

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Singles- These people will be attracted towards the restaurant due to the decorative indoors of
the place. The international standard of food choice along with decorative interiors and events
will help the singles to be attracted towards the place.
Tourists- The place is developing at a faster rate, which will help in attracting a large number of
tourists. The rise of the tourist activities will help in increasing the sales of the place and inflow
of foreign currencies as well.
4.2: Strategy for market segment
Mark’s Restaurant and Lounge will help in attracting the customers who are between the
ages of 21-60 and has an annual income of $25,000 on an average. The restaurant will help in
attracting the business men, couples, families, tourists and singles that are wealthy and have
financial stability and has to be compulsive spenders as well. The restaurant needs to target the
specific groups who visits the restaurants and bars on a frequent manner so that it can help them
in providing a better atmosphere to these customers. These people will be able to spend a good
amount on a better dining facility and good facility, which can be available at a valuable price.
The general geography of the place is that it will attract people from neighboring cities
and tourists from different places as well, which will form a major part of the clientele within the
restaurant. The clients will also include the people who have a sophisticated taste in music and
art and can appreciate the ambience in a better manner.
4.3: Strategy and implementation
The strategy of the restaurant will be simple that is it will succeed by providing the
people a combination of interesting and excellent food within a proper environment so that it can
appeal to a wider section of the people. The primary focus will be to maintain a higher quality

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with respect to the food standards and establish a core identity within the community. The major
focus of marketing will be to increase the level of awareness among the local communities so
that the customers can be attracted towards the restaurant. The programs of the restaurant will be
set in such a manner so that it can help in providing a proper explanation to the customers
regarding the practices that are present within the restaurant. The restaurant will try to keep a
higher level of standards and the major promotion of the restaurant will be done through word-
of-mouth policy.
The main aim of the restaurant will be to create an entertaining environment for the
customers with the best standard of food at an affordable price so that it can help the customers
in getting a better return on the amount that they are spending. The friendly service of the staffs
will help the customers in spreading the name of the restaurant to their friends and families so
that they can also enjoy a meal in a comfortable and relaxed manner. The primary aim of the
restaurant will be to execute the plans in an efficient manner, which will form the critical
element of the strategy taken up by the restaurant. The prices of the food that will be present in
the menu will be set accordingly so that it can provide quality food at a cheaper price and
become a value leader within the area.
4.4: Competitive edge
The restaurant will be providing classic food in its menu along with an Asian influence
and the environment will be quite cozy so that the customers can feel better within the area.
Additionally, the quality of service that will be provided by the restaurant staffs will be friendly,
as they will interact with the customers and provide them valuable insights regarding the
combination of food that they would like so that the customers can have a better experience. The
chef that will be hired to prepare the food will have an excellent taste in the choice of food as

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well. Apart from this, the environment that will be present within the restaurant will help in
providing comfort to the customers due to the relaxed ambience. The management will look after
every detail within the place so that it can help in making the customers feel special so that they
would come back to the place again.
5.0: Competitors
The major competitor will be the town that is situated next to Palm Jumeirah, as it also
contains a list of well-renowned hotels. It will also help the people who are living in the other
towns to stop at the other restaurants and have the food as well, as they are also of high
standards. These towns are being developed in a new manner, which will attract potential
customers as well.
There are three restaurants that are present in the region as well, which serves the food
that are of international standards. They have been in operation for a long time and have seen a
huge increase in the influx of customers. These restaurants have to be important for Mark’s
Restaurant and Lounge while making up the marketing strategies, as they will provide a stiff
resistance to increase the profit of the firm.
The first place consists of a 50 seat restaurant, which is also open on all days and serves
dinner and lunch as well. it provides the items at a cheaper cost as well, which helps them in
drawing the attention of most of the customers towards themselves. The price of the food on an
average varies from $10-$15 while for dinner it ranges from $14-$20.
The second restaurant is an expensive restaurant that serves a smaller menu. It is located
on the Western side of the river island, which is just three blocks away from the restaurant. They
mainly concentrate on serving dinner to the people, as they try to attract the office people only.

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The prices on the menu range from $7-$10 and a concoction of drinks can be priced at $5-$8 on
an average for a single person.
The third restaurant targets the higher section of the customers present within the
society, as it serves contemporary food to the customers. This restaurant is open on all days and a
dinner for a couple without any drinks costs $75-$100 on an average.
Most of the restaurants that are selling the products in that region are considered to be a
major competitor of Mark’s, as they have to compete with the existing hotels that already have a
set of target customers. Apart from this, there are other section of restaurant that will be
providing stiff competition to Mark’s that is the concept of casual dining experience that is
present in some restaurants and the fine dining concepts that is also present in that area. The
restaurant has to keep in mind that if the value that is provided by the fine dining restaurant is
better that the casual dining ones, it will help the customers to get attracted towards the latter.
6.0: Marketing strategy
The total population of the area is approximately 30,000, which consists of the local
communities that are present along with the tourists that are visiting the place on a continuous
manner. During the peak season, it can be seen that the foot-fall of the tourist increases to a
greater extent and the population of the area rises to around 50,000 as well.
It can be seen that almost all the people living in the region frequently visits restaurants,
as most of the population consist of tourists who are visiting the place for business or leisure
purposes. The average spending of the customers for a 4-day trip to the region is around $700.
Since many tourists come from Sweden as well, it will help them in gaining a better experience
and provide valuable insights regarding the quality of food that is being served to them. Apart

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from these people, the tourists who want to have a culinary experience can also visit the
restaurant, as it will provide them with an opportunity to taste the some of the Swedish dishes
with an Asian influence in it.
6.1: Marketing program
The restaurant will be employing various styles of tactics that are present in the
marketing plan so that it can help in increasing the level of awareness among the customers. The
restaurant will capitalize on the in-store marketing activities and the word-of-mouth policy, as it
is cheap and effective in nature.
 VIP parties- The restaurant will host VIP parties on its opening, which will help in
introducing the staffs to the local communities and will train them as well. These parties
will be hosted on a regular basis so that it can help in communicating with the important
people that are present within the community.
 The restaurant will also invite new and local artists to the restaurant so that it can help
them in show casing their talents to the customers by providing them a platform.
 Swedish Smörgåsbord, which is a meal for the Scandinavians that is served up in a buffet
manner and comprises of cold and hot dishes. This will help in attracting the Swedish
customers towards the restaurant that will be visiting the area.
 New Year’s Party will also be hosted by the restaurant so that the customers can come to
the restaurant and party as well. This will be done by providing better offers to the
customers at a cheaper price to the customers.

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6.2: Local marketing
The restaurant will make a brochure of the large hotels that are present in the area and are
known for their ‘bed in the breakfast’ within the area will be provided with pictures of the
interiors along with the prices and the menu.
There is an old care home in the locality as well, which can be used for promotional
activities. The restaurant will sponsor the meals for the elder people once in a month, which will
help them to be visible within the local community. This will help in spreading the name of the
restaurant through verbal communication as well. this will help in spreading the name of the
restaurant to the extended family members as well.
7.0: Sales strategy
The primary strategy for sales will be that to maintain the position and establish the
restaurant in front of the local customers. The focus of the strategy will be to increase the
revenue of the restaurant by attracting customers towards the organization. Since the restaurant is
a repeat business, it will help in satisfying the clients by providing an effective service and make
them happy with the food of the best quality.
7.1: Sales forecast
The average gross sale of the company would be around $68000 where the clients will
spend an average of $12 on lunch and $20 on dinner respectively. The catering service of the
company will earn an average of $10,000 and the cost of goods sold will be calculated at 33
percent. The sale is expected to increase 2 percent every year after the first year.

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8.0: Web plan summary
Mark’s Restaurant and Lounge along with Sam’s Catering will advertise in a single
website along with the business card that will help in spreading the portfolio of the company.
The card will be simple and designed in a proper manner so that the information can reach to the
clients in an efficient way. The website of the company will contain all the necessary information
along with the choice of food that will be available in the menu. The restaurant will also print
newsletter on a monthly basis so that it can help them in attracting new clients as well.
9.0: Management summary
Mark will manage the operations of the restaurant and will also be in charge of the chefs
that will be cooking the meals. The financial and the marketing of the company will be taken
care by Thomas, as he has a good knowledge regarding accounting and finance.
The managerial activities of the restaurant will be done by Mark himself such as the
delivery of the orders to the clients within the time and managing the staffs that will be waiting at
the tables. Mark has an experience of 10 years in cooking professional meals and has been
associated with Gauche, which is a fine dining restaurant dealing in French cuisine. He used to
work there as the manager of the restaurant. This has helped Mark in gaining immense
knowledge regarding the operations of the company in a better manner. He will be in charge of
the hiring of the employees so that the best employees can be bought within the restaurant, which
will help in increasing the quality of service towards the clients.
Thomas has an experience of 7 years in the hospitality industry, which will be helpful for
the company to manage its activities in an effective way. He left the job so that he can pursue his
own dream and run his own company with a person whom he can trust. This has helped both of

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them to come together and manage the restaurant in a proper manner. He has a proper knowledge
regarding the financial activities and the allocation of the funds so that the restaurant can manage
a lower cost of operations.
9.1: Management team
The compensation of the management team has been done in a proper manner with
adequate knowledge in the restaurant business along with the financial part as well. In the second
year, the restaurant will hire a General Manager so that he can assist the company and help for its
growth as well. The General Manager will look after the operations of the restaurant as well as
the catering service so that Mark can concentrate only on providing the best meals to the
customers along with the chefs.
9.2: Personnel plan
The personnel plan will be a sizeable amount within the restaurant and will be done
according to the revenue that will be projected for the company. The employees of the company
will be working for 8 hours in a shift on all days that will be an average of 56 hours in a week of
one employee.
10.0: Financial plan
Important assumptions
The financial plan of the company will be based on certain assumptions that are as
follows:
 The growth of the economy is slow and there will be no recession within the economy

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 There will be no unforeseen changes in the popularity of the restaurant, which may affect
the sales of the company
 The access to the finance and investments is enough, which will help in fulfilling the
financial plan that will be presented in the tables
 The rate of taxes is 30 percent
 Cost of goods sold will be 33 percent of the total sales
10.1: Profit and Loss Statement for the company
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue
Gross revenue $272,000 $277,440 $288,538 $305,850 $330,318
Cost of goods sold $89,760 $91,555 $95,217 $100,930 $109,005
Gross margin $182,240 $185,885 $193,320 $204,919 $221,313
Other revenue [source] $0 $0 $0 $0 $0
Interest income $0 $0 $0 $0 $0
Total revenue $182,240 $185,885 $193,320 $204,919 $221,313
Operating expenses
Sales and marketing $45,000 $45,900 $47,736 $50,600 $54,648
Payroll and payroll taxes $0 $0 $0 $0 $0
Depreciation $21,000 $21,420 $21,840 $22,260 $22,680
Maintenance, repair, and
overhaul $1,500 $1,530 $1,560 $1,590 $1,620
Total operating expenses $67,500 $68,850 $71,136 $74,450 $78,948
Operating income $114,740 $117,035 $122,184 $130,469 $142,365
Interest expense on long-term
debt $7,188 $5,789 $4,291 $2,688 $973
Operating income before other items $107,552 $111,246 $117,893 $127,781 $141,391
Loss (gain) on sale of assets $0 $0 $0 $0 $0
Other unusual expenses (income) $0 $0 $0 $0 $0
Earnings before taxes $107,552 $111,246 $117,893 $127,781 $141,391
Taxes on income 30% $32,265 $33,374 $35,368 $38,334 $42,417
Net income (loss) $75,286 $77,872 $82,525 $89,447 $98,974
Cumulative income $75,286 $153,158 $235,684 $325,131 $424,105

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10.2: Balance Sheet for the company
Assets Initial balance Year 1 Year 2 Year 3 Year 4 Year 5
Cash and short-term investments $130,000
$173,8
60
$218,0
48
$263,6
31
$311,7
72
$364,7
96
Accounts receivable $0 $0 $0 $0 $0 $0
Total inventory $8,160.00
$8,323.
20
$8,656.
13
$9,175.
50
$9,909.
54 $9,910
Prepaid expenses 0 0 0 0 0 $0
Deferred income tax 0 0 0 0 0 $0
Other current assets 0 0 0 0 0 $0
Total current assets $138,160
$182,1
83
$226,7
04
$272,8
07
$321,6
81
$374,7
05
Buildings $20,000
$20,00
0
$20,00
0
$20,00
0
$20,00
0
$20,00
0
Land 0 0 0 0 0 0
Capital improvements
$
10,000 10,000 10,000 10,000 10,000 10,000
Machinery and equipment
$
75,000 75,000 75,000 75,000 75,000 75,000
Less: Accumulated depreciation
expense 0 21,000 42,420 64,260 86,520
109,20
0
Net property/equipment $105,000
$84,00
0
$62,58
0
$40,74
0
$18,48
0
($4,20
0)
Goodwill $56,840
$13,82
0
$77,83
6
$30,67
9 $0 $0
Deferred income tax 0 0 0 0 0 0
Long-term investments 0 0 0 0 0 0
Deposits 0 0 0 0 0 0
Other long-term assets 0 0 0 0 0 0
Total assets $300,000
$280,0
03
$367,1
20
$344,2
26
$340,1
61
$370,5
05
Liabilities Initial balance Year 1 Year 2 Year 3 Year 4 Year 5
Accounts payable $0 $0 $0 $0 $0 $0
Accrued expenses 0 0 0 0 0 0
Notes payable/short-term debt 0 0 0 0 0 0
Capital leases 0 0 0 0 0 0
Other current liabilities
108,51
5
108,51
6
128,94
9
185,50
5
Total current liabilities $0 $0
$108,5
15
$108,5
16
$128,9
48
$185,5
05
Long-term debt from loan
payment calculator
11
5,000
$95,00
3
$73,60
5
$50,71
0
$26,21
3 ($0)
Other long-term debt $0 $0 $0 $0 $0 $0

21BUSINESS PLAN
Total debt $115,000
$95,00
3
$182,1
20
$159,2
26
$155,1
61
$185,5
05
Other liabilities 0 0 0 0 0 0
Total liabilities $115,000
$95,00
3
$182,1
20
$159,2
26
$155,1
61
$185,5
05
Equi
ty Initial balance Year 1 Year 2 Year 3 Year 4 Year 5
Owner's equity (common)
$
185,000
$185,0
00
$185,0
00
$185,0
00
$185,0
00
$185,0
00
Paid-in capital 0 0 0 0 0 0
Preferred equity 0 0 0 0 0 0
Retained earnings 0 0 0 0 0 0
Total equity $185,000
$185,0
00
$185,0
00
$185,0
00
$185,0
00
$185,0
00
Total liabilities and equity $300,000
$280,0
03
$367,1
20
$344,2
26
$340,1
61
$370,5
05
10.3: Cash Flow Statement
Year 1 Year 2 Year 3 Year 4 Year 5 Total
Operating activities
Net income $75,286 $77,872 $82,525 $89,447 $98,974 $424,105
Depreciation $21,000 $21,420 $21,840 $22,260 $22,680 $109,200
Accounts receivable $0 $0 $0 $0 $0 $0
Inventories ($163) ($333) ($519) ($734) $0 ($1,750)
Accounts payable $0 $0 $0 $0 $0 $0
Amortization 0 0 $0 $0 $0 $0
Other liabilities 0 0 $0 $0 $0 $0
Other operating cash flow
items 0 0 $0 $0 $0 $0
Total operating activities $96,123 $98,959 $103,846 $110,973 $121,654 $531,555
$0
Investing activities $0
Capital expenditures $0 $0 $0 $0 $0 $0
Acquisition of business 0 0 0 0 0 $0
Sale of fixed assets ($32,265) ($33,374) ($35,368) ($38,334) ($42,417)
($181,759
)
Other investing cash flow
items 0 0 0 0 0 $0
Total investing activities ($32,265) ($33,374) ($35,368) ($38,334) ($42,417)
($181,759
)
Financing activities

22BUSINESS PLAN
Long-term debt/financing ($19,997) ($21,397) ($22,895) ($24,498) ($26,213)
($115,000
)
Preferred stock 0 0 0 0 0 0
Total cash dividends paid 0 0 0 0 0 0
Common stock 0 0 0 0 0 0
Other financing cash flow
items 0 0 0 0 0 0
Total financing activities ($19,997) ($21,397) ($22,895) ($24,498) ($26,213)
($115,000
)
Cumulative cash flow $43,860 $44,188 $45,583 $48,141 $53,024 $234,796
Beginning cash balance $130,000 $173,860 $218,048 $263,631 $311,772
Ending cash balance $173,860 $218,048 $263,631 $311,772 $364,796

23BUSINESS PLAN
11.0: Appendices
11.1: Appendix 1
Owner capital Investor Bank Loan Expense Cash-in-hand
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
Series1
Graph showing the capital and expense of restaurant
11.2: Appendix 2
Fixed Expenses
Fixed Expenses
Bldgs / Real Estate $ 20,000
Leasehold Improvements 10,000
Capital Equipment 75,000
Location / Admin Expenses 20,000
Opening Inventory -
Advertising / Promo Expenses 45,000
Other Expenses -
Total Fixed Expenses $ 170,000
Variable Expenses
Inventory or Materials 3%
Direct labor (includes payroll taxes) 2%
Other expenses 1%
Other expenses 1%
Salaries (includes payroll taxes) 5%
Supplies 4%
Total Variable Expenses 16%

24BUSINESS PLAN
Breakeven Sales level
=
$170,272.
44 Year 1 Year 2 Year 3 Year 4 Year 5
Net income (loss)
-
$170,272.
44
$75,286.
09
$77,872.
33
$82,525.
37
$89,446.7
6
$98,974.0
2
Cumulative income
-
$94,986.
34
-
$17,114.
02
$65,411.
35
$154,858.
10
$253,832.
13
Positive Cash Flow? FALSE FALSE TRUE TRUE TRUE
Undiscounted
breakeven year 3 years
Actual break even
period 2.21 years
Breakeven sales for the company will in the 3rd year and specifically in 2.21 years.