Adventure Travel and Tours Limited: Detailed Financial Plan Analysis

This project presents a comprehensive financial plan for Adventure Travel and Tours Limited, a startup tourist resort in Australia. The plan includes an executive summary, vision, mission, goals, and objectives. It details financial projections, including basic assumptions, startup costs, depreciation schedules, and projected room bookings. The document provides projected sales revenue, expenses, income statements, balance sheets, and cash flow statements over three years. Further, it incorporates break-even analysis, capital budgeting analysis, and projected ratio analysis to assess the financial viability and performance of the business. The financial plan is designed to provide a detailed overview for investors and stakeholders, outlining the company's strategic direction and financial sustainability.

Running head: MANAGE BUDGETS AND FINANCIAL PLANS
Manage Budgets and Financial Plans
Name of the Student:
Name of the University:
Author Note:

2
MANAGE BUDGETS AND FINANCIAL PLANS
Executive Summary
The tourism industry in Australia had undergone rapid growth over several past decades. The
current trend shows that there is an increase in the number of tourists who enter the country and
provides an opportunity for Australian tours for penetrating in the market. The services of
Adventure Travel and Tours Limited will be positioned very carefully where the company will
deal with providing extremely high quality as well as comfortable experience to the clients so
that they have greater appreciation in the natural environment. In an nutshell, Adventure Travel
and Tours Limited do not just intend to market or sell the service but also to sell travel solutions
and provide a total quality environment to their valued customers that will help in establishing
reputable corporate image.

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MANAGE BUDGETS AND FINANCIAL PLANS
Table of Contents
Introduction to Business investors or stakeholders.........................................................................3
Vision Statement of Adventure Travel and Tours Limited.........................................................3
Mission Statement of Adventure Travel and Tours Limited.......................................................3
Goal of Adventure Travel and Tours Limited.............................................................................3
Objectives of Adventure Travel and Tours Limited....................................................................3
Financial Plan..................................................................................................................................5
Basic Assumptions.......................................................................................................................5
Start-up Cost................................................................................................................................6
Depreciation and Amortization Schedule....................................................................................7
Projected Room Bookings...........................................................................................................8
Projected Sales Revenue............................................................................................................10
Projected Expenses....................................................................................................................11
Projected Income Statement......................................................................................................13
Projected Balance Sheet............................................................................................................15
Projected Cash Flow Statement.................................................................................................17
Break-even Analysis..................................................................................................................22
Capital Budgeting Analysis.......................................................................................................25
Projected Ratio Analysis............................................................................................................26
Reference List................................................................................................................................27

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MANAGE BUDGETS AND FINANCIAL PLANS
Introduction to Business investors or stakeholders
Vision Statement of Adventure Travel and Tours Limited
The vision statement of Adventure Travel and Tours Limited is to become one of the
well-known tourist resorts in Australia in the eyes of community, people and customer. The start-
up tourist resort expects and demands the best that they desire to offer by keeping the service on
top of the choice of valued local visitors and tourists (Renz 2016).
Mission Statement of Adventure Travel and Tours Limited
The mission statement of Adventure Travel and Tours Limited is to offer superior
hospitality experience and enhance guest’s maximum satisfaction. In addition, the start-up tourist
resort believes in creation of positive work environment for attainment of results to satisfy
guests, investors and employees. Adventure Travel and Tours Limited aims at satisfying the
tourist and local visitors who actually travel for relaxation (Petty et al. 2015).
Goal of Adventure Travel and Tours Limited
The goal of Adventure Travel and Tours Limited is to satisfy the need of valued
customers and guests by conducting market research.
Objectives of Adventure Travel and Tours Limited
 To exceed in the customer expectations where the start-up company will provide access
to luxury services to the valued customers in terms of tours, travels and resort
 To maintain 90% occupancy rate at the time of peak periods
 To hire experienced and hardworking staff members

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MANAGE BUDGETS AND FINANCIAL PLANS
Financial Plan
Basic Assumptions
BASIC ASSUMPTIONS:
Type of Business: Company
Nature of Project: Tours and Travels
Capital Structure:
Equity 50%
Non-Current Debts 50%
Types of Debts:
5 yr. Bonds at Par 0%
5 years Loan from Bank 100%
Required Rate of Return on
Equity 10.00%
Interest Rate on Loan:
Bonds 0.00%
Loan from Bank 8.50%
Tax Rate 30%
Inflation Rate 0.00%
Mode of Sales:
Cash 100%
Credit 0%
Cash Collection Period 30 days
Mode of Purchase:
Cash 50%
Credit 50%
Cash Payment Period 60 days
Wages & Salary Payment
15th day on the following
month
Electricity, Telephone &
Internet payment
7th day on the following
month
Other Operating Payments Last day of the month
Insurance & Membership
Fees 6 months' Advance
Depreciation Method:
Building & Improvement Straight Line Method
Furniture & Fittings
10% - Reducing Balance
Method

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MANAGE BUDGETS AND FINANCIAL PLANS
Computer, Electrical Equipment
& Other Accessories
30% - Reducing Balance
Method
Kitchen Appliances, Cutleries &
Cookeries
40% - Reducing Balance
Method
Motor Vehicle Straight Line Method
Explanation
 Motor vehicle and building & improvement will be depreciated by using straight-line method
 Computer, Electrical Equipment, Kitchen appliances, and furniture & Fittings will be depreciated by using reducing
balance method
 Mode of payment will be 50% of cash and 50% on credit
 Loan from bank will taken at 8.50% (Madura 2014)
Start-up Cost
Particulars Amount
Residual
Value
Non-Current Assets:
Land $2,500,000 $0
Building & Improvement $5,000,000 $1,500,000
Furniture & Fittings $1,500,000 $450,000
Computer, Electrical
Equipment & Other
Accessories $3,000,000 $0
Kitchen Appliances, Cutleries
& Cookeries $1,250,000 $0
Motor Vehicle $1,000,000 $300,000
Preliminary Expenses:
Land Registration $65,000
Business Registration $125,000
License Fees $50,000
Deposit for Electricity $72,000 $72,000
Deposit for Telephone &
Internet $35,000 $35,000

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MANAGE BUDGETS AND FINANCIAL PLANS
Recruitment Cost $125,000
Share Issuance Cost $30,000
Other Miscellaneous Expenses $200,000
Working Capital:
Purchase of Food, Drinks &
Other Supplies $2,250,000
Wages & Salaries $500,000
Power & Fuel $200,000
Promotion & Advertisement $150,000
General Administrative
Expenses $300,000 $3,400,000
TOTAL START UP COST
$18,352,00
0
Capital Funding:
Equity Capital $9,176,000
Loan From Bank $9,176,000
TOTAL CAPITAL
EMPLOYED
$18,352,00
0
Explanation
 Total start-up cost that will be required for starting Adventure Tours and Travel Limited will be $18352000.
 In case of capital funding, the start-up business will apply for loan from bank amounting to $9176000, equity capital
amounting to $9176000 (Lasher 2013)
Depreciation and Amortization Schedule
DEPRECIATION & AMORTIZATION SCHEDULE:
Particulars
Opening
Balance
Salvage
Value
Estimate
d Life
Depreciatio
n Rate
Perio
d
Depreciatio
n Amount
Closing
Balance
(in
Years)
Building &
Improvements:

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MANAGE BUDGETS AND FINANCIAL PLANS
Year 1
$5,000,00
0
$1,500,00
0 25 1 $140,000
$4,860,00
0
Year 2
$4,860,00
0
$1,500,00
0 24 1 $140,000
$4,720,00
0
Year 3
$4,720,00
0
$1,500,00
0 23 1 $140,000
$4,580,00
0
Furniture & Fittings:
Year 1
$1,500,00
0 $450,000 12 10% 1 $150,000
$1,350,00
0
Year 2
$1,350,00
0 $450,000 11 10% 1 $135,000
$1,215,00
0
Year 3
$1,215,00
0 $450,000 10 10% 1 $121,500
$1,093,50
0
Computer, Electronic
Equipment & Other
Accessories:
Year 1
$3,000,00
0 $0 7 30% 1 $900,000
$2,100,00
0
Year 2
$2,100,00
0 $0 6 30% 1 $630,000
$1,470,00
0
Year 3
$1,470,00
0 $0 5 30% 1 $441,000
$1,029,00
0
Kitchen Appliances,
Cutleries & Crookeries:
Year 1
$1,250,00
0 $0 5 40% 1 $500,000 $750,000
Year 2 $750,000 $0 4 40% 1 $300,000 $450,000
Year 3 $450,000 $0 3 40% 1 $180,000 $270,000
Motor Vehicle:
Year 1
$1,000,00
0 $300,000 10 1 $70,000 $930,000
Year 2 $930,000 $300,000 9 1 $70,000 $860,000
Year 3 $860,000 $300,000 8 1 $70,000 $790,000
Projected Room Bookings
PROJECTED ROOM BOOKINGS:
1st Year 2nd Year 3rd Year

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MANAGE BUDGETS AND FINANCIAL PLANS
Particulars
Qt.
1
Qt.
2 Qt.3 Qt.4 Qt.1 Qt.2 Qt.3 Qt.4 Qt.1 Qt.2 Qt.3 Qt.4
Nature Villa - Room Available 20 20 20 20 20 25 25 25 35 35 35 35
Occupancy Rate
50
%
55
% 60% 80% 80% 60% 70% 85% 87% 65% 67% 85%
Projected Booking - Nature
Villa 900 990
108
0
144
0
144
0
135
0
157
5
191
3
2740.
5
2047.
5
2110.
5
2677.
5
Palm Cottage - Room Available 15 15 15 15 15 15 15 20 20 20 20 20
Occupancy Rate
60
%
65
% 67% 85% 85% 70% 72% 87% 88% 72% 74% 92%
Projected Booking - Palm
Cottage 810 878 905
114
8
114
8 945 972
156
6 1584 1296 1332 1656
Deluxe Suit - Room Available 3 3 3 3 3 3 3 3 5 5 5 5
Occupancy Rate
90
%
75
% 72% 92% 92% 75% 75% 94% 90% 78% 80% 92%
Projected Booking - Deluxe Suit 243 203 194 248 248 203 203 254 405 351 360 414

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MANAGE BUDGETS AND FINANCIAL PLANS
Projected Sales Revenue
PROJECTED SALES REVENUE:-
1st Year 2nd Year 3rd Year
Particulars Qt.1 Qt.2 Qt.3 Qt.4 Qt.1 Qt.2 Qt.3 Qt.4 Qt.1 Qt.2 Qt.3 Qt.4
Nature Villa - Room
Booking 900 990 1080 1440 1440 1350 1575
1912.
5
2740.
5
2047.
5
2110.
5
2677.
5
Average Room Rent
$8,50
0
$8,50
0
$8,50
0
$8,50
0
$8,50
0
$8,50
0
$8,50
0
$8,50
0
$10,0
00
$10,0
00
$10,0
00
$10,0
00
Projected Room Rent -
Nature Villa
$7,65
0,000
$8,41
5,000
$9,18
0,000
$12,2
40,00
0
$12,2
40,00
0
$11,4
75,00
0
$13,3
87,50
0
$16,2
56,25
0
$27,4
05,00
0
$20,4
75,00
0
$21,1
05,00
0
$26,7
75,00
0
Palm Cottage - Room
Booking 810 878 905 1148 1148 945 972 1566 1584 1296 1332 1656
Average Room Rent
$12,0
00
$12,0
00
$12,0
00
$12,0
00
$12,0
00
$12,0
00
$12,0
00
$12,0
00
$13,0
00
$13,0
00
$13,0
00
$13,0
00
Projected Room Rent -
Palm Cottage
$9,72
0,000
$10,5
30,00
0
$10,8
54,00
0
$13,7
70,00
0
$13,7
70,00
0
$11,3
40,00
0
$11,6
64,00
0
$18,7
92,00
0
$20,5
92,00
0
$16,8
48,00
0
$17,3
16,00
0
$21,5
28,00
0
Deluxe Suit - Room
Booking 243 203 194 248 248 203 203 254 405 351 360 414
Average Room Rent
$15,0
00
$15,0
00
$15,0
00
$15,0
00
$15,0
00
$15,0
00
$15,0
00
$15,0
00
$17,5
00
$17,5
00
$17,5
00
$17,5
00
Projected Room Rent -
Deluxe Suit
$3,64
5,000
$3,03
7,500
$2,91
6,000
$3,72
6,000
$3,72
6,000
$3,03
7,500
$3,03
7,500
$3,80
7,000
$7,08
7,500
$6,14
2,500
$6,30
0,000
$7,24
5,000
Average Guest per Room 2 2 2 2 2 2 2 2 2 2 2 2
Average Fooding &
Drinking Charges per
Guest
$4,00
0
$4,00
0
$4,00
0
$4,00
0
$4,00
0
$4,00
0
$4,00
0
$4,00
0
$4,50
0
$4,50
0
$4,50
0
$4,50
0
Total Revenue from
Fooding & Drinking
$15,6
24,00
0
$16,5
60,00
0
$17,4
31,20
0
$22,6
87,20
0
$22,6
87,20
0
$19,9
80,00
0
$21,9
96,00
0
$29,8
58,40
0
$42,5
65,50
0
$33,2
50,50
0
$34,2
22,50
0
$42,7
27,50
0

11
MANAGE BUDGETS AND FINANCIAL PLANS
Projected Expenses
PROJECTED EXPENSES:-
1st Year 2nd Year 3rd Year
Particulars Qt.1 Qt.2 Qt.3 Qt.4 Qt.1 Qt.2 Qt.3 Qt.4 Qt.1 Qt.2 Qt.3 Qt.4
One-Time Start-Up
Cost:
Land
$2,500
,000
Building &
Improvement
$5,000
,000
Furniture & Fittings
$1,500
,000
Computer, Electrical
Equipment & Other
Accessories
$3,000
,000
Kitchen Appliances,
Cutleries &
Crookeries
$1,250
,000
Motor Vehicle
$1,000
,000
Land Registration
$65,00
0
Business Registration
$125,0
00
License Fees
$50,00
0
Deposit for Electricity
$72,00
0
Deposit for
Telephone & Internet
$35,00
0
Recruitment Cost
$125,0
00
Share Issuance Cost
$30,00
0
Other Miscellaneous
Expenses
$200,0
00
Fixed Operating
Expenses:
Depreciation on
Building &
Improvement
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0
$35,00
0

12
MANAGE BUDGETS AND FINANCIAL PLANS
Depreciation on
Furniture & Fittings
$37,50
0
$37,50
0
$37,50
0
$37,50
0
$33,75
0
$33,75
0
$33,75
0
$33,75
0
$30,37
5
$30,37
5
$30,37
5
$30,37
5
Depreciation on
Computer, Electronic
Equipment & Other
Devices
$225,0
00
$225,0
00
$225,0
00
$225,0
00
$157,5
00
$157,5
00
$157,5
00
$157,5
00
$110,2
50
$110,2
50
$110,2
50
$110,2
50
Depreciation on
Kitchen Appliances,
Cutleries & Cookeries
$125,0
00
$125,0
00
$125,0
00
$125,0
00
$75,00
0
$75,00
0
$75,00
0
$75,00
0
$45,00
0
$45,00
0
$45,00
0
$45,00
0
Depreciation on
Motor Vehicles
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
$17,50
0
Wages & Salary to
Permanent Staffs
$450,0
00
$1,000
,000
$1,000
,000
$1,000
,000
$1,100
,000
$1,100
,000
$1,100
,000
$1,100
,000
$1,200
,000
$1,200
,000
$1,200
,000
$1,200
,000
Membership to Hotel
Association $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,500 $2,500 $2,500 $2,500
Insurance $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $6,000 $6,000 $6,000 $6,000
Advertisement &
Promotion
$50,00
0
$125,0
00
$50,00
0
$50,00
0
$62,50
0
$62,50
0
$62,50
0
$62,50
0
$68,75
0
$68,75
0
$68,75
0
$68,75
0
Variable Operating
Expenses:
Cost of Fooding &
Drinking
$5,468
,400
$5,796
,000
$6,100
,920
$7,940
,520
$7,940
,520
$6,993
,000
$7,698
,600
$10,45
0,440
$14,89
7,925
$11,63
7,675
$11,97
7,875
$14,95
4,625
Wages to Temporary
Staffs
$2,613
,150
$2,755
,125
$2,890
,620
$3,755
,520
$3,755
,520
$3,290
,625
$3,604
,050
$4,928
,603
$7,010
,775
$5,498
,325
$5,658
,300
$7,050
,150
Supplies Expenses
$4,324
,050
$4,539
,375
$4,749
,840
$6,161
,940
$6,161
,940
$5,376
,375
$5,863
,050
$8,067
,668
$11,45
5,088
$9,013
,613
$9,274
,838
$11,53
6,763
Electricity
$4,984
,200
$5,224
,500
$5,461
,560
$7,081
,560
$7,081
,560
$6,169
,500
$6,717
,600
$9,263
,970
$13,14
5,175
$10,35
5,625
$10,65
5,325
$13,24
5,975
Power & Fuel
$2,868
,975
$3,033
,563
$3,188
,430
$4,146
,480
$4,146
,480
$3,643
,313
$4,001
,625
$5,450
,141
$7,761
,938
$6,074
,213
$6,251
,400
$7,797
,825
Telephone & Internet
$498,4
20
$522,4
50
$546,1
56
$708,1
56
$708,1
56
$616,9
50
$671,7
60
$926,3
97
$1,314
,518
$1,035
,563
$1,065
,533
$1,324
,598
Cost of Tour
$317,3
63
$336,3
75
$354,0
71
$460,8
34
$553,0
01
$487,0
13
$536,1
53
$727,7
99
$1,106
,703
$864,5
13
$889,7
85
$1,110
,915
Cleaning Charges
$2,882
,700
$3,026
,250
$3,166
,560
$4,107
,960
$4,107
,960
$3,584
,250
$3,908
,700
$5,378
,445
$7,636
,725
$6,009
,075
$6,183
,225
$7,691
,175
Maintenance Charges
$4,324
,050
$4,539
,375
$4,749
,840
$6,161
,940
$6,161
,940
$5,376
,375
$5,863
,050
$8,067
,668
$11,45
5,088
$9,013
,613
$9,274
,838
$11,53
6,763
Special Discount on
Corporate Booking
$525,3
75
$549,5
63
$573,7
50
$743,4
00
$743,4
00
$646,3
13
$702,2
25
$971,3
81
$1,377
,113
$1,086
,638
$1,118
,025
$1,388
,700
Commission to Travel
Agencies
$210,1
50
$219,8
25
$229,5
00
$297,3
60
$297,3
60
$258,5
25
$280,8
90
$388,5
53
$550,8
45
$434,6
55
$447,2
10
$555,4
80
TOTAL EXPENSES
$44,91
5,833
$32,11
4,400
$33,50
8,247
$43,06
2,670
$43,14
6,087
$37,93
0,488
$41,33
5,953
$56,10
9,313
$79,22
7,266
$62,53
8,881
$64,31
1,728
$79,70
8,343