Financial Projections and Analysis for EV Charging Station Project

This project provides a comprehensive financial analysis of an electric vehicle charging station. It begins by specifying business capital requirements, detailing startup expenses, and sources of funding. The project then presents financial projections, including profit and loss statements, balance sheets, and cash flow statements over a three-year period. It covers gross revenue, operating expenses, and net income, along with asset and liability analysis. A break-even analysis is conducted to determine the sales level required for profitability, and the project assesses various risks and rewards associated with the business. Finally, the project anticipates financial returns, highlighting potential revenue streams and profitability, concluding that the business is anticipated to attain its break even in the first year of its operation.

Running head: FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING
STATION
Financial Projections of Electric Vehicle Charging Station
Name of the University:
Name of the Student:
Authors Note:

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
Table of Contents
1. Financial Projections..............................................................................................................2
1.1. Specifying Business Capital Requirements....................................................................2
1.2. Providing Financial Projections in Professional Ways...................................................5
1.3. Conducting Break-Even Analysis for Sales..................................................................10
1.4. Assessing Risks and Rewards.......................................................................................11
1.5. Anticipating Financial Returns.....................................................................................13
References................................................................................................................................15

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
1. Financial Projections
1.1. Specifying Business Capital Requirements
Summary Statement
Sources of Capital
Owners' and Other Investments $ 5,037,700
Bank Loans 5,000
Other Loans 110,000
Total Source of Funds $ 5,152,700
Startup Expenses
Bldgs / Real Estate $ 70,500
Leasehold Improvements 22,000
Capital Equipment 67,000
Location / Admin Expenses 76,000
Opening Inventory -
Advertising / Promo Expenses 5,600
Other Expenses 475,000
Total Startup Expenses $ 11,021,500
Startup Expenses
Buildings / Real Estate
Purchase $ 50,000

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
lease 20,000
Remodeling -
Other 500
Total Buildings and R / E $ 70,500
Leasehold Improvements
Item 1 $ 5,500
Item 2 $ 5,500
Item 3 $ 5,500
Item 4 $ 5,500
Total L / H Improvements $ 22,000
Capital Equipment List
Charging stations $ 55,000
Equipment $ 1,500
Fixtures $ 1,500
car manufacturing machinery $ 6,500
Other $ 2,500
Total Capital Equipment $ 67,000
Location and Admin Expenses
Rental $ -
Utility Deposits 5,500
Legal and Accounting Fees 4,500
Prepaid Insurance 55,000

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
Pre-opening Salaries 5,500
Other 5,500
Total Location and Admin Expenses $ 76,000
Opening Inventory
Equipment sales $ 3,560
Charging stations $ 2,060
Parking area $ 2,460
System $ 2,660
Office rental $ 2,960
Total Inventory $ 13,700
Advertising and Promotional Expenses
Advertising $ 1,400
Signage $ 1,500
Printing $ 1,200
Travel & Entertainment $ 1,500
Other / Additional categories -
Total Adv and Promo expenses $ 5,600
Payroll and payroll taxes
Salary $ 450,000
Wages 25,000
Total Payroll and payroll taxes $ 475,000

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
1.2. Providing Financial Projections in Professional Ways
Year 1 Year 2 Year 3
Gross revenue $2,360,000 $2,407,200 $2,503,488
Cost of goods sold $236,000 $240,720 $250,349
Gross margin $2,124,000 $2,166,480 $2,253,139
Other revenue [source] $1,245,643 $1,450,090 $2,005,000
Interest income $0 $0 $0
Total revenue $3,369,643 $3,616,570 $4,258,139
Operating expenses
Sales and marketing
$
5,600 $5,712 $5,940
Payroll and payroll taxes $475,000 $484,500 $503,880
Depreciation $31,900 $32,538 $33,176
Maintenance, repair, and overhaul $0 $0 $0
Total operating expenses $512,500 $522,750 $542,996
Operating income $2,857,143 $3,093,820 $3,715,143
Interest expense on long-term debt $897 $716 $526

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
Operating income before other items $2,856,246 $3,093,104 $3,714,616
Loss (gain) on sale of assets $0 $0 $0
Other unusual expenses (income) $0 $0 $0
Earnings before taxes $2,856,246 $3,093,104 $3,714,616
Taxes on income 30% $856,874 $927,931 $1,114,385
Net income (loss) $1,999,372 $2,165,172 $2,600,231
Table 1: Profit and Loss Statement
Assets Initial
balance
Year 1 Year 2 Year 3
Cash and short-term
investments
$0 $193,781 $503,518 $3,197,704
Accounts receivable 0 2,000 2,000 2,000
Total inventory 0 2,500 2,500 2,500
Prepaid expenses 0 2,600 2,600 2,600
Deferred income tax 0 2,800 2,800 2,800
Other current assets 0 2,850 2,850 2,850
Total current assets $0 $206,531 $516,268 $3,210,454
Buildings $70,500 $70,500 $70,500 $70,500

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
Land 0 0 0 0
Capital improvements $
22,000
22,000 22,000 22,000
Machinery and
equipment
$
67,000
67,000 67,000 67,000
Less: Accumulated
depreciation expense
9,233 41,133 73,671 106,847
Net
property/equipment
$150,267 $118,367 $85,829 $52,653
Goodwill $0 $0 $0 $0
Deferred income tax 0 0 0 0
Long-term investments 0 0 0 0
Deposits 0 0 0 0
Other long-term assets 0 0 0 0
Total assets $150,267 $324,898 $602,097 $3,263,107
Liabilities Initial
balance
Year 1 Year 2 Year 3
Accounts payable $65,000 $65,000 $65,000 $65,000
Accrued expenses 0 0 0 0
Notes payable/short-
term debt
0 0 0 0
Capital leases 0 0 0 0
Other current
liabilities
0 0 0 0
Total current liabilities $65,000 $65,000 $65,000 $65,000

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
Long-term debt from
loan payment
calculator
115,000
$16,381 $12,580 $8,590
Other long-term debt $0 $0 $0 $0
Total debt $180,000 $81,381 $77,580 $73,590
Other liabilities 0 0 0 0
Total liabilities $180,000 $81,381 $77,580 $73,590
Equity Initial
balance
Year 1 Year 2 Year 3
Owner's equity
(common)
$50,000 $50,000 $50,000 $50,000
Paid-in capital 0 0 0 0
Preferred equity 0 0 0 0
Retained earnings 0 0 0 0
Total equity $50,000 $50,000 $50,000 $50,000
Total liabilities and
equity
$230,000 $131,381 $127,580 $123,590
Table 2: Balance Sheet Statement
Year 1 Year 2 Year 3 Total
Operating activities

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
Net income $200,000 $216,000 $2,600,000 $3,016,000
Depreciation $31,900 $32,538 $33,176 $97,614
Accounts receivable ($2,000) $0 $0 ($2,000)
Inventories ($2,500) $0 $0 ($2,500)
Accounts payable $0 $0 $0 $0
Amortization 5,000 5,000 $5,000 $15,000
Other liabilities 25,000 25,000 $25,000 $75,000
Other operating cash flow
items 0 0 $0 $0
Total operating activities $257,400 $278,538 $2,663,176 $3,199,114
$0
Investing activities $0
Capital expenditures $0 $0 $0 $0
Acquisition of business 15,000 15,000 15,000 $45,000
Sale of fixed assets $10,000 $10,000 $10,000 $30,000
Other investing cash flow
items 0 0 0 $0
Total investing activities $25,000 $25,000 $25,000 $75,000
$0
Financing activities $0
Long-term debt/financing ($98,619) ($3,800) ($3,990) ($106,410)
Preferred stock 0 0 0 $0
Total cash dividends paid 5,000 5,000 5,000 $15,000
Common stock 0 0 0 $0
Other financing cash flow 5,000 5,000 5,000 $15,000

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
items
Total financing activities ($88,619) $6,200 $6,010 ($76,410)
$0
Cumulative cash flow $193,781 $309,738 $2,694,186 $3,197,704
Beginning cash balance $0 $193,781 $503,518
Ending cash balance $193,781 $503,518 $3,197,704
1.3. Conducting Break-Even Analysis for Sales
Fixed Expenses
Fixed Expenses
Inventory or Materials 22,800,000
office rental 70,000
Charging parking rental 148,500
Advertising 200,000
Salaries (includes payroll taxes) 450,000
System 60,000
Depreciation 27,000
Total Fixed Expenses $ 23,755,500
Variable Expenses
Utility 39,000
Operation and maintenance 41,000
Total Variable Expenses 80000
Breakeven Sales level = -29732

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FINANCIAL PROJECTIONS FOR ELECTRIC VEHICLE CHARGING STATION
1.4. Assessing Risks and Rewards
The risks that can be faced by this new business must be given a thoughtful consideration
in order to analyze the likely costs and advantages. The company needs t realize the areas in
which risks can take place so that it can be easy for the entrepreneur to determine the
potential rewards that can make the risks worth taking (Baker 2014). Certain risks that can be
faced by the new “Electric vehicle charging station” company are explained under:
 There can be increased rate of business failure. This can be because of the rising
difficulty in testing the new business idea without trading.
 Financial risks can take place in the startup of this new business that can lead to huge
loss of this company (Calabrò 2017). In order to deal with this risk the business
requires to get involved in careful planning, developing an effective cash reserve
along with developing an effective contingency budgeting along with taking decision
to deal with it.
 Another major risk can take place in case the consumer response is aggressive.
Moreover, another risk is regarding the fact that it is easy to underestimate the effort
along with persistence that is required to be successful (Ciftci and Darrough 2015).
 Poor market research ad implementation of the unrealistic plan can result in poor
catering to consumer demand. In such scenario, the business will not be able to catch
up with competitor’s response such as drastic price cuts and increased promotional
activities.
 Risks can also take place in the company’s new business because of poor execution of
its effective ideas (Gordon et al. 2017). This can take place because of wrong people
and poor management, a rapid or extremely slow growth along with failure to manage
all the company’s cash flows.