Comprehensive Financial Plan Report for Eco-Friendly Straw Company

This report presents a comprehensive financial plan for an eco-friendly straw business, analyzing its viability and feasibility. The plan includes detailed forecasts for revenue, expenses, and profit over a five-year period, with a focus on four major product lines: Natural Wheat Drinking Straws, Biodegradable Bamboo Straws, Milk Flavouring Straws, and Edible Straws. The income statement forecast projects increasing revenues and profits, while the balance sheet forecast outlines the company's assets, liabilities, and equity. Furthermore, the cash flow forecast demonstrates the company's ability to generate positive cash flows. The report provides a thorough financial analysis, supported by references, and demonstrates the potential for the business to be profitable and successful. The financial projections are based on realistic assumptions about sales volume, pricing, and costs, providing a clear picture of the business's financial health.

Financial Plan
For
Business

Table of Contents
The Financial Plan...........................................................................................................................3
Income Statement Forecast:...................................................................................................4
Balance Sheet Forecast:..........................................................................................................4
Cash Flow Forecast:...............................................................................................................5
REFERENCES................................................................................................................................6

The Financial Plan
Financial Plan of business exhibits whether idea of business of Eco- friendly Straw
company is viable or feasible. It also act as focus area for investors who are interested in our
business idea. The entire financial plan section comprise three financial forecast: income
forecast, cash flow forecast and balance sheet forecast and along with explanation and analysis
of these forecasts. Company has an unique idea of launching of Eco- friendly straws which is
currently in trend. These straws are outstanding manner to protect enamel on teeth along with
protection of environment. Daily thousands and lacs of straws are utilize in country.
Replacement of these ordinary plastic straws with eco- friendly straws can minimise use of
plastic which is not good for environment.
Thus Company will launch four major products: Natural Wheat Drinking Straws,
Biodegradable Bamboo Straw, Milk Flavouring Straw and Edible Straws. Based on these
products company's forecasted revenue will be AUD 115600.00. This figure is aggregate total of
these four products' total sales which are, as follows:
Forecasted Revenue
Units sold
(annually)
Average
price per
unit
Annual
revenue
per product
Natural Wheat Drinking Straws 270 105.00 28,350.00
Biodegradable Bamboo Straw 420 95.00 39,900.00
Milk Flavouring Straw 250 75.00 18,750.00
Edible Straws 520 55.00 28,600.00
Total of Forecasted Revenue 1,15,600.00
Based on current business scenario it has been forecasted that sale of Edible Straws will
be highest 520 units annually. While overall revenue of Biodegradable Bamboo Straw is
estimated to be highest AUD 39900. Further company under financial plan also estimated gross
margin on each product. Margin on edible straw is 30% and natural wheat straw is 32%. While
Biodegradable Bamboo Straw will be sold at gross margin of 27% and Milk Flavouring Straw 's
gross margin will be 22%.

Income Statement Forecast:
Income statement forecast is crucial among financial forecast which are required to be
included in business's financial plan. It exhibits company's estimated revenues from sale of
different products, expenses and overall profit during particular financial year (Ramsey, 2013). It
act as preview of business, shows whether business plan is profitable or not. Revenues less
Expenses = Profit/Loss. In this context for business of Eco - friendly straw five year income
statement forecast is done under financial plan.
Company's gross after deducting cost of sales from revenue will be 83,050.00,
84,711.00 ,88,099.44, 93,385.41 and 1,00,856.24 during 5year. While company's projected
aggregate operating expenses are 62,267.85, 62,966.17, 64,727.44, 67,657.54 and 71,936.10
during initial 5years of business. Company's net profits are expected to be 14,547.51, 15,221.38,
17,060.40, 18,009.51 and 20,244.09 in initial 5 years. These figures shows that business would
be profitable.
Balance Sheet Forecast:
A forecast of items of Balance Sheet exhibits net value of business in projected period. It
presents business's all fiscal and economic information under three major headings: assets,
liabilities, and equity (Hayden, 2016). Company's current asset is estimated to be 83000 in initial
year which will further increased to:
Year 1 Year 2 Year 3 Year 4 Year 5
Current
assets 1,93,593.89 1,54,483.98 1,90,810.52 2,53,657.47 1,93,282.89
In business there is building of 20000, land of 10000 and Machinery of 10000. Accounts
payable of company projected to be AUD 2000 and other current liabilities to be AUD 100. In
business there are long term loan of 55000 from bank and long term debts are 100000. In
business total equity of 300000 is engaged initially. In this amount of total equity, 250000 is
funded though paid-up capital and owner's equity is 50000. After combining amount of retained
earning following will be total equity:
Equity
Initial Year 1 Year 2 Year 3 Year 4 Year 5

balance
Owner's equity (common) 50,000.0
0
50,000.0
0
50,000.0
0
50,000.0
0
50,000.0
0
50,000.0
0
Paid-in capital 2,50,000
.00
2,50,000
.00
2,50,000
.00
2,50,000
.00
2,50,000
.00
2,50,000
.00
Retained earnings - 14,547.5
1
29,768.8
9
46,829.2
9
64,838.7
9
85,082.8
9
Total Equity 3,00,000
.00
3,14,547
.51
3,29,768
.89
3,46,829
.29
3,64,838
.79
3,85,082
.89
Cash Flow Forecast:
A cash flow projection stated in financial plan demonstrates how cash anticipated to flow
within business. It also shows how much fund or capital investment required for business idea. A
cash flow estimate shows how effectively business will generate cash flow after adjustment of all
cash receipt and payments (Warschauer and Sciglimpaglia, 2012). This also demonstrates how
efficiently company is maintaining positive cash flow in business. In business of Eco- friendly
straw, cash flow is estimated to be:
Ending cash balance 1,60,593.89 1,21,483.98 1,57,810.52 2,20,657.47 1,60,282.89
In all years business will provide positive cash flows. Which shows that business is
viable and has potentials of generating cash flows in future.

REFERENCES
Books and Journals
Ramsey, D., 2013. The Total Money Makeover: Classic Edition: A Proven Plan for Financial
Fitness. Thomas Nelson.
Hayden, R.M., 2016. Comprehensive Financial Plan Generator, Client-to-Client Comparative
Analytics Tool, Advisor Ratings, Overall Financial Wellness Rating System and On-
Demand Decision Analysis, Data Importation Aggregator. U.S. Patent Application
14/886,273.
Warschauer, T. and Sciglimpaglia, D., 2012. The economic benefits of personal financial
planning: An emperical analysis. Financial Services Review, 21(3).