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Cover Page

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Legal Page
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Table of Contents

1.0 Executive Summary....................................................................................................................................1

1.1 Objectives................................................................................................................................................2
Chart: Highlights.......................................................................................................................................2
1.2 Keys to Success.......................................................................................................................................2
1.3 Mission....................................................................................................................................................2
2.0 Company Summary.....................................................................................................................................3
2.1 Company Ownership..............................................................................................................................3
2.2 Start-up Summary...................................................................................................................................3
Table: Start-up...........................................................................................................................................4
...................................................................................................................................................................4
Table: Start-up Funding............................................................................................................................5
Chart: Start-up...........................................................................................................................................6
3.0 Services.......................................................................................................................................................6
4.0 Market Analysis Summary.........................................................................................................................6
4.1 Market Segmentation..............................................................................................................................6
Table: Market Analysis.............................................................................................................................7
Chart: Market Analysis (Pie)....................................................................................................................7
4.2 Target Market Segment Strategy............................................................................................................7
4.3 Service Business Analysis......................................................................................................................7
4.3.1 Competition and Buying Patterns....................................................................................................8
5.0 Strategy and Implementation Summary.....................................................................................................8
5.1 Competitive Edge....................................................................................................................................8
5.2 Marketing Strategy..................................................................................................................................9
5.3 Sales Strategy..........................................................................................................................................9
5.3.1 Sales Forecast.................................................................................................................................10
Table: Sales Forecast..........................................................................................................................10
Chart: Sales Monthly..........................................................................................................................11
Chart: Sales by Year...........................................................................................................................11
5.4 Milestones.............................................................................................................................................12
Table: Milestones....................................................................................................................................12
Chart: Milestones....................................................................................................................................13
6.0 Management Summary.............................................................................................................................13
6.1 Personnel Plan.......................................................................................................................................13
Table: Personnel......................................................................................................................................14
7.0 Financial Plan............................................................................................................................................15
7.1 Important Assumptions.........................................................................................................................15
Table: General Assumptions...................................................................................................................15
.....................................................................................................................................................................15
7.2 Break-even Analysis.............................................................................................................................16
Table: Break-even Analysis....................................................................................................................16
Chart: Break-even Analysis....................................................................................................................16
7.3 Projected Profit and Loss......................................................................................................................17
Table: Profit and Loss.............................................................................................................................17
Chart: Profit Monthly..............................................................................................................................18
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Table of Contents

Chart: Profit Yearly.................................................................................................................................18

Chart: Gross Margin Monthly................................................................................................................19
Chart: Gross Margin Yearly...................................................................................................................19
7.4 Projected Cash Flow.............................................................................................................................20
Chart: Cash..............................................................................................................................................20
Table: Cash Flow....................................................................................................................................21
.....................................................................................................................................................................21
7.5 Projected Balance Sheet........................................................................................................................22
Table: Balance Sheet...............................................................................................................................22
.....................................................................................................................................................................22
7.6 Business Ratios.....................................................................................................................................23
Table: Ratios...........................................................................................................................................23
Table: Sales Forecast.........................................................................................................................................1
...........................................................................................................................................................................1
Table: Personnel................................................................................................................................................2
...........................................................................................................................................................................2
Table: General Assumptions.............................................................................................................................3
...........................................................................................................................................................................3
Table: Profit and Loss.......................................................................................................................................4
...........................................................................................................................................................................5
Table: Cash Flow..............................................................................................................................................6
Table: Balance Sheet.........................................................................................................................................7

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Wheatland Health Services

1.0 Executive Summary

Wheatland Health Services offers a unique combination of premier home health care and
community-based social services to Southeastern Kansas. Market research indicates that there
is a significant need for quality home health care and social services within this region and we
believe that by employing competent and well-educated staff and providing them with
organized and responsive management, we can become the home health care/social service
agency of choice in Southeastern Kansas.
Wheatland Health Services will be created as a Kansas Limited Liability Company based in
Wilson County, owned by its principal investors and principal operators. The initial office will be
established in quality office space on Main Street in Neodesha, Kansas, which is the heart of
Southeastern Kansas. Neodesha is also home to a hospital facility and a renowned Wound
Center, which will serve as referral bases for our agency.
Consumers of our services will be those individuals and families in need of home health care
and/or social services. These patients are usually referred by other health care professionals
such as physicians, attorneys, insurance companies and health care facilities. Our agency has
already developed an excellent reputation with many of these professionals, through the work
of our Clinical Director, who has been providing home health care services through another
agency for the past three years, and through the presentations we have made to the
community via marketing tools and personal interactions.
Our agency must be licensed by the State of Kansas and our services reimbursed by Medicare,
Medicaid and other private insurance carriers. The process for licensure and insurance
certification has already been initiated and we are well on our way to meeting the regulations
and guidelines for providing home health care and social services to patients in Southeastern
Kansas.
There are currently only three other home health care agencies that serve Southeastern
Kansas. One is a satellite operation based out of a larger regional hospital in Bartlesville,
Oklahoma. Kellene Walker currently manages this agency's operation there, and due to the lack
of interest the parent organization has demonstrated in this satellite agency, we believe that
upon her transfer to Wheatland Health Services that agency will close its Wilson County
operation. The other home health care agencies currently operating in our area do not offer
services to all four of our target Counties; they also do not offer the unique blend of home
health care and social services which Wheatland Health Services will be providing.
All pricing will be set according to Medicare, Medicaid and other insurance regulation so pricing
is not a major factor of consideration. Sales estimates project healthy revenues in the first year
and modest increases through year three.
WHS is incorporated as a partnership. The primary founder, Elizabeth Patzer, MSW/PA, is a
social worker and public administrator with prior experience in operating a social service
agency. The partnership will include a second, non-managing partner, M. Brad Patzer, who will
help with initial start-up funding and retain a minority equity stake. Wheatland Health Services
will be managed by Beth Patzer and Kellene Walker, our Clinical Director.
The company plans on taking on debt in the form of a five-year loan, and has no plans for
additional debt as growth will be financed mainly through cash flow. Our plan includes

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Wheatland Health Services

assumptions of 100% sales on credit, and sufficient cash on-hand at start-up to prevent any
problems with cash flow.
1.1 Objectives

125 Home Health Care patients served by the end of first year.
12 Personal Injury Case Management Clients served by the end of first year.
Respectable gross sales by the end of first year.
80% of Customer Satisfaction Surveys returned indicating satisfaction with services.

Chart: Highlights

Highlights
$500,000
$450,000
$400,000
$350,000

Sales

$300,000

Gross Margin

$250,000

Net Profit

$200,000
$150,000
$100,000
$50,000
$0
Year 1

Year 2

Year 3

1.2 Keys to Success

Professional quality of services offered

Reliability -- being available through on-call, and adequate staffing
Effective collaboration with other community professionals (physicians, hospitals, and other
organizations)

1.3 Mission
Our values are simple. Wheatland Health Services strives to offer excellent and affordable home
health care and community-based social services to individuals and families of Southeastern
Kansas.
It is our goal to employ competent, caring, and well-trained individuals who are responsive to
the needs of our patients, their families, and the communities we serve. Each staff member will
meet the State of Kansas educational and training requirements for the services they provide.
We encourage and support continued education of each service provider. In turn, our agency

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Wheatland Health Services

will provide staff with competitive compensation, an inviting work environment, and
knowledgeable, trustworthy management and direction.
2.0 Company Summary
Wheatland Health Services is a new Home Health and Social Service agency in its start-up
stages. Our agency will be located in the heart of Southeastern Kansas and will provide the
following services to patients and clients from Neodesha, Wilson, Montgomery and
Labette Counties - all within a ninety mile radius of our offices:

Skilled Nursing
Nursing Aide
Social Work
Occupational, Physical, and Speech Therapy
Personal Injury Case Management

2.1 Company Ownership

Wheatland Health Services is a limited liability company owned and operated by Elizabeth G.
Patzer, MSW/MPA and Marlon B. Patzer, M.S./M.Ed.
2.2 Start-up Summary
Wheatland Health Services is in its start-up stage, and consequently there are start-up costs
and funding issues to address. The Start-Up Table, below, indicates in detail those costs which
include the following:

BUSINESS DEVELOPMENT
RENTAL EXPENSE
OFFICE EQUIPMENT
OFFICE SUPPLIES
NURSING SUPPLIES

The table also demonstrates Assets needed for start-up and addresses potential funding
sources which are to include cash investments made by each Owner, as well as a five-year 8%
loan which will be needed in order to cover start-up costs.

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Wheatland Health Services

Table: Start-up

Start-up
Requirements
Start-up Expenses
BUSINESS DEVELOPMENT
Attorney Fees - Setting Up Limited Liability Company
State of Kansas Home Health Agency License
Medisoft Billing Program plus Support
Professional Liability Insurance
*Assuming 25% down of $12,000.00
Workman's Comp Insurance Deposit
Premises and Content Insurance Deposit
*Assuming 25% down of $1200.00
Contract Retainer with PT/OT/ST
Inserted Row
RENTAL EXPENSE
Office Upgrades (Carpet and Paint)
Deposit plus First
*Assuming $200.00/Month
Phone Set Up (Excluding Phones)
Utilities Deposit
Post Office Box
Inserted Row
OFFICE EQUIPMENT
2 Computers (Fully Loaded)
4-in-1 Printer/Fax/Copier/Scanner
QuickBooks Pro
Phones
Pager
Inserted Row
OFFICE SUPPLIES
Stationary
Business Cards
Brochures
Other Misc. Office Supplies
Computer
NURSING SUPPLIES
Total Start-up Expenses

$0
$875
$100
$5,000
$3,000
$0
$500
$300
$0
$500
$0
$0
$3,000
$400
$0
$250
$150
$26
$0
$0
$3,000
$750
$300
$200
$50
$0
$0
$200
$150
$200
$450
$0
$2,500
$21,901

Start-up Assets
Cash Required
Other Current Assets
Long-term Assets
Total Assets

$44,599
$3,500
$0
$48,099

Total Requirements

$70,000

Page 4

Wheatland Health Services

Table: Start-up Funding

Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required

$21,901
$48,099
$70,000

Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets

$3,500
$44,599
$0
$44,599
$48,099

Liabilities and Capital

Liabilities
Current Borrowing
Long-term Liabilities
Accounts Payable (Outstanding Bills)
Other Current Liabilities (interest-free)
Total Liabilities

$0
$50,000
$0
$0
$50,000

Capital
Planned Investment
Elizabeth Patzer
Investor
Additional Investment Requirement
Total Planned Investment
Loss at Start-up (Start-up Expenses)
Total Capital

$20,000
$0
$0
$20,000
($21,901)
($1,901)

Total Capital and Liabilities

$48,099

Total Funding

$70,000

Page 5

Wheatland Health Services

Chart: Start-up

Start-up
$50,000
$45,000
$40,000
$35,000
$30,000
$25,000
$20,000
$15,000
$10,000
$5,000
$0
Expenses

Assets

Investment

Loans

3.0 Services
Wheatland Health Services offers premier home health care that includes skilled nursing,
nursing aide, social work, occupational therapy, speech therapy, and physical therapy. We also
provide personal injury case management services which include assessment, planning,
resource linkage, reporting and professional services (court testimony, etc.).
4.0 Market Analysis Summary
The consumer base for Wheatland Health Services (Home Health Care Services) will be patients
referred by physicians, health care facilities and other health care professionals. The majority of
these patients will be covered by Medicare with a smaller portion being insured by Kansas
Medicaid or other private insurance carriers.
The consumer base for the Personal Injury Case Management component of our business will
be those individuals who have been injured either on the job or in another type of accident.
These referrals will come from attorneys seeking case management services for their clients or
from insurance companies who are requesting assistance in mitigating the injuries and loss the
client suffers.
4.1 Market Segmentation
The population base in Southeastern Kansas is aging, and more individuals are opting to stay in
their own homes longer and return home following hospitalization, rather than proceeding to a
nursing home. Our primary market segment includes those patients -- typically in an older age
bracket -- who require health care services by home health nursing staff. These patients may
also require other home health services, such as social work, in order to access needed
community resources.

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Wheatland Health Services

Our secondary market will be those individuals who have suffered a personal injury and require
case management services to assist them in addressing medical, financial, and employment
issues.
Table: Market Analysis

Market Analysis
Potential Customers

Year 1

Year 2

Year 3

Year 4

Year 5

10%
10%

100
25

110
28

121
31

133
34

146
37

9.92%
10.30%

30%
12.31%

12
137

16
154

21
173

27
194

35
218

30.68%
12.31%

Growth

HHC - Medicare Patients

HHC - Medicaid and Private
Insurance Patients
PICM Patients
Total

CAGR

Chart: Market Analysis (Pie)

Market Analysis (Pie)

HHC - Medicare Patients

HHC - Medicaid and Private Insurance Patients
PICM Patients

4.2 Target Market Segment Strategy

Because our agency specializes in home health care and community-based social services, we
will focus on those market segments where we know our services are most needed. Focusing on
those market segments that require only home-based services will greatly decrease overhead,
since additional office space will not be required.
4.3 Service Business Analysis
Wheatland Health Services is a combined Home Health Care and Social Service Agency serving
a four-county region in Southeastern Kansas. Home health care and social services are typically
utilized by individuals and families, with service referrals coming most often from other
professionals (i.e. physicians, hospitals, attorneys, etc.).

Page 7

Wheatland Health Services

There are currently three other Home Health Agencies serving the same area, but we are
unique in that we plan to offer community-based social services as well as home health care.
4.3.1 Competition and Buying Patterns
The key factor considered by both consumers and referring professionals when purchasing
home health care is trust in the professional reputation, reliability and quality of services
provided by the home health Agency.
Pricing of home health services does not usually influence consumers' choices, as most home
health services are reimbursed by Medicare, Medicaid, and private insurance companies, and
reimbursement rates are set by those entities. Pricing of personal injury case management
services is a more important factor, as these services are paid for as negotiated on a case-bycase basis at an hourly rate. When pricing personal injury case management services, we will
explain to the client that we estimate the total number of hours needed to complete services
liberally, rather than bidding low and then exceeding the anticipated total bid price for services.
Consumers of both home health care services and personal injury case management services
rarely compare service providers directly. Usually they follow word-of-mouth recommendations,
especially when those recommendations come from their physicians.
Perhaps the most important element for assessing competition in the Home Health and Social
Service fields is how to persuade other professionals to repeatedly refer their clients to our
agency for services. As our agency demonstrates outstanding patient care, current and
pertinent qualification of service providers, and professional organization and business
management, we believe that we will be able to capture the majority of the home health care
and personal injury case management market in our designated region.
5.0 Strategy and Implementation Summary
Wheatland Health Services will focus on four counties within southeastern Kansas. Within this
geographical area we will target two specific programs:

home health care

personal injury case management

Within each area, we have two target markets: the actual client, and the regional physicians,
health care facilities, attorneys and insurance companies who refer them to our services.
5.1 Competitive Edge
We start with a competitive edge: There are currently only three home health care agencies
serving southeastern Kansas; Kellene Walker, our Clinical Director, has been employed with
one of them for three years and has learned many of the day-to-day administrative functions
that make a home health care agency successful. Ms. Walker has built a reputation for
outstanding customer service, and it is our belief that her reputation will help to build a strong
client base even before our start-up date.
Wheatland Health Services will also stand out in integrating community-based social services,
such as Personal Injury Case Management, with our more traditional home health care. This
broader base will allow us to access additional clientele and payor bases, adding to our financial
stability. This integration also leaves room in the long-term for the addition of other social

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Wheatland Health Services

services, such as Family Counseling, Psycho-Educational Services, and Mental Health Case
Management.
5.2 Marketing Strategy
Marketing our service-oriented business requires establishing a reputation for expertise and
excellence. It starts with our known contacts who are in positions to recommend us and make
referrals to us, and continues with long-term efforts to develop recognition among other
professionals within the health care and social service fields.
We will develop and maintain a database of our contacts in the field. Ms. Walker is already wellknown to physicians, other nurses and hospital facilities in our market area, and will work to
maintain those relationships throughout our start-up process. Ms. Patzer will make initial
contacts in the community as she establishes the business entity and provider status with
Medicare, Medicaid, private insurance companies and local attorneys. She will then join Ms.
Walker in an effort to introduce Wheatland Health Services to area professionals who are
potential referral sources. Our communications will be professional, as will our marketing tools
such as brochures, business cards, and advertisements.
5.3 Sales Strategy
Sales in our business means quality patient service and utmost satisfaction from referring
physicians and health care facilities. It is perpetual business. One doesn't sell home health care
and personal injury case management; rather one sells excellent care, availability, and effective
interpersonal relationships.
In a service industry, growth can mean loss of quality control, which in turn leads to client
dissatisfaction. The services we provide should always reflect the mission and oversight of
management. We want our clients to know that the quality of service they receive will be
excellent, regardless of the individual service provider performing the service.
We will therefore avoid the temptation to broaden the scope of our services too quickly. Rather,
we will focus our immediate attentions on making the services we offer of the highest possible
quality. Only when those services are well-established and grounded in excellence will we
consider expanding our service base.

Page 9

Wheatland Health Services

5.3.1 Sales Forecast

Annual sales reflect a conservative average of 125 new Home Health Care patients for the first
year with a modest increase per year thereafter. This figure is based on the number of patients
currently being seen by an existing home health care agency in Southeastern Kansas. Research
indicates that this agency is a satellite office of a larger regional organization and investment in
the satellite office has been minimal. We believe that with a greater investment in marketing,
employee relations, and customer service this client base can grow significantly.
The projected annual figures for Personal Injury Case Management sales are relatively low, as
this portion of the business will initially be secondary to the Home Health Care Services.
However, we project a jumped up annual growth after the first year, as market analysis
indicates there is a significant need for these services. As the Home Health Care portion of the
business stabilizes management will focus growth efforts on the Personal Injury Case
Management program.
Table: Sales Forecast

Sales Forecast
Year 1

Year 2

Year 3

Home Health Care Sales

Personal Injury Case Management Sales
Total Sales

$413,740
$19,200
$432,940

$455,114
$24,960
$480,074

$500,625
$32,448
$533,073

Direct Cost of Sales

Home Health Care Sales
Personal Injury Case Management Sales
Subtotal Direct Cost of Sales

Year 1
$21,721
$2,400
$24,121

Year 2
$22,156
$2,520
$24,676

Year 3
$22,599
$2,646
$25,245

Sales

Page 10

Wheatland Health Services

Chart: Sales Monthly

Sales Monthly
$50,000
$45,000
$40,000
$35,000
$30,000

Home Health Care Sales

$25,000

Personal Injury Case Management Sales

$20,000
$15,000
$10,000
$5,000
Month 12

Month 11

Month 10

Month 9

Month 8

Month 7

Month 6

Month 5

Month 4

Month 3

Month 2

Month 1

$0

Chart: Sales by Year

Sales by Year

$500,000
$450,000
$400,000
$350,000

Home Health Care Sales

$300,000

Personal Injury Case Management Sales

$250,000
$200,000
$150,000
$100,000
$50,000
$0
Year 1

Year 2

Year 3

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Wheatland Health Services

5.4 Milestones
The accompanying table lists important program milestones, with dates and managers in
charge, and budgets for each. The milestone schedule indicates our emphasis on planning for
implementation.
What the table doesn't show is the commitment behind it. Our business plan includes complete
provisions for plan-vs.-actual analysis, and we will hold monthly follow-up meetings to discuss
the variance and course corrections.
Table: Milestones

Milestones
Milestone
Attorney Draws Up LLC
Verify Numbers For Budget
Meeting with CPA for tax advise
and request for Tax ID
Identify Office Location
Finalize Application for Insurance
Coverages
Apply for State Licensure
Apply for Bank Loan
Finalize Lease Agreement
Move Into Offices and Prepare for
Site Survey
Site Survey
Develop/Finalize all forms,
procedures, employment contracts
Apply for all Provider Numbers
Hold First All Staff Meeting
Totals

Start Date
1/1/2004
8/1/2003
1/7/2004

End Date
1/31/2003
9/15/2003
1/15/2004

Budget
$875
$0
$0

Manager
Beth
Beth
Beth

Department
Administrator
Administrator
Administrator

1/2/2004
12/15/2003

1/15/2004
1/31/2004

$0
$4,800

Beth
Beth

Administrator
Administrator

2/1/2004
1/2/2004
2/1/2004
12/13/2004

2/1/2004
2/1/2004
2/1/2004
2/20/2004

$100
$0
$800
$10,000

Beth
Beth & Brad
Beth
Beth

Administrator
Administrator
Administrator
Administrator

3/19/2004
3/15/2003

3/29/2004
4/1/2004

$0
$350

Beth
Beth & Kellene

Administrator
Administrator

4/15/2004
6/15/2004

6/1/2004
6/15/2004

$0
$50
$16,975

Beth
Beth & Kellene

Administrator
Administrator

Page 12

Wheatland Health Services

Chart: Milestones

Milestones
Verify Numbers For Budget
Identify Office Location
Apply for State Licensure
Finalize Lease Agreement
Site Survey
Apply for all Provider Numbers

Q2

Q3

Q4 Q1 `04 Q2

Q3 Q4

6.0 Management Summary

Wheatland Health Services' initial team will consist of one Administrative Director, one Clinical
Director, three employees and a contracted agency to fulfill the need for Physical Therapists,
Occupational Therapists, and Speech Therapists. Initially, both managers will also provide direct
service. Elizabeth Patzer is a licensed social worker and will provide all social work services
during the start-up stage of the business. She will also provide all administrative direction and
will perform most of the administrative functions with assistance from an Administrative
Assistant. Kellene Walker is a registered nurse and has experience as a Skilled Nurse and
Director of Nursing for a Home Health Agency. She will also provide direct nursing services
during the initial stages of the business, as well as supervising the nursing staff. As the need for
service providers grows, both managers will assume primary roles in management and
will delegate direct service to employees.
Wheatland Health Services has no current management or personnel gaps; our plan provides
for hiring service providers only as growth demands. Job descriptions have been written for
each position and we will develop an employee handbook prior to our Start Date.
6.1 Personnel Plan
The following is an explanation of personnel needs, costs, and benefits as listed in the
Personnel table. The projections for the next three years are based on minimal growth in client
base and therefore no resulting impact on payroll due to increased hours of service. A cost of
living increase is noted for all employees but does not impact the Administrative Director as she
is the owner of the business and will realize increase through profit gains.

Administrative Director -- This position will be held by the agency owner. The
Administrative Director will also assume all Social Work hours of service during the initial
stages of the venture as those hours are projected to be minimal. It is assumed that as
need for Social Work hours increases a second Social Worker will be hired. *Owner's

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Wheatland Health Services

compensation will be made in the form of a draw and will not include payroll taxes, cost of
insurance, etc., as these costs will be assumed by the owner; these after-tax expenses can
be found in the detailed Profit and Loss table.

Clinical Director -- This position will be held by Kellene Walker, who has prior experience
as Clinical Director for a home health care agency in Southeastern Kansas. Ms. Walker's
compensation will be in the form of a salary, based for the first year on $1000/week. It has
been agreed that at the end of each calendar year Ms. Walker shall be entitled to a
TBA percent of the company's net profits (less taxes and interest expense). The company
will pay employer portion of payroll taxes for Ms. Walker and will allow for 4 weeks of paid
personal leave per year and 11 paid holidays, but benefits will not include medical
insurance, retirement or other fringe benefits. The Clinical Director will also assume the
majority of Skilled Nursing hours of service during the initial stages of the venture as that
will be her primary role. As the need for additional Skilled Nursing hours increases,
additional Skilled Nurses will be hired.

Administrative Assistant -- This position is based on 30 hours per week reimbursed, at

$12.00 per hour. Initially there will be no benefits attached to this position except for four
weeks of paid personal leave and 11 paid holidays to be used at the discretion of the
employee with prior notification to the Administrator.

Skilled Nurse -- This position will be paid $18.50 per hour for direct service hours. The
total reimbursement as shown in the Personnel Table is calculated on 1040 hours per full
year. In addition, the Skilled Nurse will be paid $408 per month for On-Call Hours served.
On-Call Hours are figured at $1.50/hr. x 16 hrs x 5 days + $1.75/hr x 24 hours x 2 days x 2
weeks/month. There will be no benefits attached to this position other than 2 weeks of paid
personal leave and 5.5 paid holidays per year, as this is a part-time position.

Nurse's Aide -- This position will be paid $10.00 per hour for direct service hours. The total
reimbursement as shown on the Personnel Table is calculated on 1040 hours per year.
There will be no benefits attached to this position other than 2 weeks of paid personal leave
and 5.5 paid holidays per year, as this is a part-time position.

Social Worker -- This position will be paid $18.50 per hour for direct service hours. The
total reimbursement as shown in the Personnel Table is calculated on 520 hours per year.
There will be no benefits attached to this position initially until the need for more hours of
service is realized.

We will also contract for other therapeutical services, as described below. These contracted
expenses can be found in the Profit and Loss table.

Physical Therapist/Occupational Therapist/Speech Therapist -- These positions will be

contracted at a rate of $30.00 per hour. The total reimbursement is based on 650 hours per
year. There will be no benefits attached to these positions, as they are contracted on a feefor-service reimbursement basis only.

Table: Personnel

Personnel Plan
Year 1

Year 2

Year 3

Page 14

Wheatland Health Services

Administrative Director - Elizabeth Patzer, MSW/MPA

Clinical Director - Kellene Walker, RN
Administrative Assistant
Skilled Nurse
Nurses Aide
Social Worker
Total People
Total Payroll

$0
$52,000
$18,720
$20,110
$10,413
$8,100
7

$0
$53,560
$19,282
$24,856
$10,712
$9,912
7

$0
$55,167
$19,860
$25,601
$11,033
$10,209
7

$109,343

$118,322

$121,870

7.0 Financial Plan

We want to finance growth mainly through cash flow. We recognize that this means we will
have to grow more slowly than we might like.
The most important factor for our financial plan is collection of receivables. Our home health
care services will be reimbursed primarily by Medicare, Medicaid, and other private insurances.
History indicates that these payors are sometimes slow to reimburse and receivables can get
hung up in the automated payment system if not tracked closely. As we broaden our scope of
services to include a larger payor base, these lags in collection of receivables will have less
impact on cash flow.
Our figures are based on start-up capital as shown in the Start-up and Start-up Funding tables;
we will consider an additional loan if needed.
7.1 Important Assumptions
The General Assumptions table, below, shows our important (and conservative) annual
assumptions concerning interest rates, tax rates, and personnel burden. In addition:
1. We assume a strong economy, without major recession.
2. We assume, of course, that there are no significant unforeseen changes in the federal policy
that dictates Medicare and Medicaid reimbursement of Home Health Care Services.
Table: General Assumptions

General Assumptions
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other

Year 1

Year 2

Year 3

1
10.00%
8.00%
30.00%
0

2
10.00%
8.00%
30.00%
0

3
10.00%
8.00%
30.00%
0

Page 15

Wheatland Health Services

7.2 Break-even Analysis

The Break-even Analysis below is based on monthly fixed costs and an Average Per
Unit Variable Cost. This assumption about cost of sales may at first look low, but in our servicebased business, payroll is included with other operating expenses in our fixed monthly
amounts, so the variable costs relate to the only other cost of service provided: mileage to and
from service locations.
At these levels, we need to bill and collect the amount shown below per month to cover our per
month costs. We don't really expect to reach break-even until a few months into the business
operation.
Table: Break-even Analysis

Break-even Analysis
Monthly Revenue Break-even

$17,532

Assumptions:
Average Percent Variable Cost
Estimated Monthly Fixed Cost

6%
$16,555

Chart: Break-even Analysis

Break-even Analysis
$15,000
$12,000
$9,000
$6,000
$3,000
$0
($3,000)
($6,000)
($9,000)
($12,000)
($15,000)
$0

$6,000
$3,000

$9,000

$12,000
$18,000
$24,000
$30,000
$15,000
$21,000
$27,000
$33,000

Page 16

Wheatland Health Services

7.3 Projected Profit and Loss

Our projected profit and loss is shown in the following table, with sales increasing throughout
the three years of the plan, and profits are notable even for the start-up phase of this business.
per month
We are projecting growth and total annual sales very conservatively, with high projected
expenses. Our cost of sales is relatively low, as this is a service agency and the primary costs
involved in providing the services are those related to payroll. The costs of sales reflects the
cost of mileage reimbursement to employees, because the services we provide are home- and
community-based and require travel to and from service locations.
The Profit and Loss table also contains our expenses for independently contracted physical,
occupational and speech therapists, as well as the owner's and Clinical Director's after-tax
draws.
Table: Profit and Loss

Pro Forma Profit and Loss

Year 1

Year 2

Year 3

Sales
Direct Cost of Sales
Other Costs of Sales
Total Cost of Sales

$432,940
$24,121
$0
$24,121

$480,074
$24,676
$0
$24,676

$533,073
$25,245
$0
$25,245

Gross Margin
Gross Margin %

$408,819
94.43%

$455,398
94.86%

$507,829
95.26%

Payroll
Payroll Taxes
Depreciation
Rent
Heat and Lights
Phone
Cell Phones
Water and Garbage
Internet Access
Professional Liability Insurance
Workman's Comp Insurance
Premises and Content Insurance
Advertising and Marketing
Meals and Entertainment
Professional Development
Office Equipment and Supplies
Contracted Therapists: OT/PT/ST
Nursing Supplies

$109,343
$29,920
$0
$2,400
$1,800
$3,000
$1,800
$600
$300
$9,000
$600
$600
$1,200
$600
$1,200
$4,800
$19,500
$12,000

$118,322
$30,423
$0
$3,600
$1,800
$3,000
$1,800
$600
$300
$12,000
$600
$600
$1,200
$600
$1,200
$4,800
$19,500
$12,000

$121,870
$30,956
$0
$3,600
$1,800
$3,000
$1,800
$600
$300
$12,000
$600
$600
$1,200
$600
$1,200
$4,800
$19,500
$12,000

Total Operating Expenses

$198,663

$212,346

$216,425

Profit Before Interest and Taxes

EBITDA
Interest Expense
Taxes Incurred

$210,156
$210,156
$4,000
$61,847

$243,053
$243,053
$4,000
$71,716

$291,403
$291,403
$4,000
$86,221

Net Profit
Net Profit/Sales

$144,309
33.33%

$167,337
34.86%

$201,182
37.74%

Expenses

Page 17

Wheatland Health Services

Chart: Profit Monthly

Profit Monthly
$20,000
$18,000
$16,000
$14,000
$12,000
$10,000
$8,000
$6,000
$4,000
$2,000
$0
Month 1

Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10
Month 12

Chart: Profit Yearly

Profit Yearly

$210,000
$180,000
$150,000
$120,000
$90,000
$60,000
$30,000
$0
Year 1

Year 2

Year 3

Page 18

Wheatland Health Services

Chart: Gross Margin Monthly

Gross Margin Monthly

$45,000
$40,000
$35,000
$30,000
$25,000
$20,000
$15,000
$10,000
$5,000
$0
Month 1

Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10
Month 12

Chart: Gross Margin Yearly

Gross Margin Yearly

$500,000

$400,000

$300,000

$200,000

$100,000

$0
Year 1

Year 2

Year 3

Page 19

Wheatland Health Services

7.4 Projected Cash Flow

The following cash flow projections show the annual amounts only. Collection of accounts
receivable from our sales on credit will greatly affect our cash flow. Cash flow projections are
critical to our success. The monthly cash flow is shown in the illustration, with one bar
representing the cash flow per month, and the other the monthly cash balance. The annual
cash flow figures are included here and the more important detailed monthly numbers are
included in the appendix.

Chart: Cash

Cash
$120,000
$100,000
$80,000
$60,000

Net Cash Flow

$40,000

Cash Balance

$20,000

Month 12

Month 11

Month 10

Month 9

Month 8

Month 7

Month 6

Month 5

Month 4

Month 3

Month 2

Month 1

$0

Page 20

Wheatland Health Services

Table: Cash Flow

Pro Forma Cash Flow

Year 1

Year 2

Year 3

$0
$341,293
$341,293

$0
$470,096
$470,096

$0
$521,854
$521,854

$0
$0
$0
$0
$0
$0
$0
$341,293

$0
$0
$0
$0
$0
$0
$0
$470,096

$0
$0
$0
$0
$0
$0
$0
$521,854

Year 1

Year 2

Year 3

$109,343
$161,040
$270,383

$118,322
$196,683
$315,006

$121,870
$208,739
$330,608

Sales Tax, VAT, HST/GST Paid Out

Principal Repayment of Current Borrowing
Other Liabilities Principal Repayment
Long-term Liabilities Principal Repayment
Purchase Other Current Assets
Purchase Long-term Assets
Dividends
Subtotal Cash Spent

$0
$0
$0
$0
$0
$0
$0
$270,383

$0
$0
$0
$0
$0
$0
$0
$315,006

$0
$0
$0
$0
$0
$0
$0
$330,608

Net Cash Flow

Cash Balance

$70,910
$115,509

$155,091
$270,600

$191,246
$461,846

Cash Received
Cash from Operations
Cash Sales
Cash from Receivables
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing
New Other Liabilities (interest-free)
New Long-term Liabilities
Sales of Other Current Assets
Sales of Long-term Assets
New Investment Received
Subtotal Cash Received
Expenditures
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent

Page 21

Wheatland Health Services

7.5 Projected Balance Sheet

The balance sheet in the following table shows managed but sufficient growth of net worth, and
a sufficiently healthy financial position. The monthly estimates are included in the appendix.
Table: Balance Sheet

Pro Forma Balance Sheet

Year 1

Year 2

Year 3

$115,509
$91,647
$3,500
$210,656

$270,600
$101,624
$3,500
$375,724

$461,846
$112,843
$3,500
$578,189

$0
$0
$0
$210,656

$0
$0
$0
$375,724

$0
$0
$0
$578,189

Year 1

Year 2

Year 3

Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

$18,248
$0
$0
$18,248

$15,979
$0
$0
$15,979

$17,262
$0
$0
$17,262

Long-term Liabilities
Total Liabilities

$50,000
$68,248

$50,000
$65,979

$50,000
$67,262

Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital

$20,000
($21,901)
$144,309
$142,408
$210,656

$20,000
$122,408
$167,337
$309,745
$375,724

$20,000
$289,745
$201,182
$510,927
$578,189

Net Worth

$142,408

$309,745

$510,927

Assets
Current Assets
Cash
Accounts Receivable
Other Current Assets
Total Current Assets
Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
Liabilities and Capital
Current Liabilities

Page 22

Wheatland Health Services

7.6 Business Ratios

The following table shows the projected businesses ratios, and a comparison of our ratios with
standards for the home health care industry (SIC code 8082.000). We expect to maintain
healthy ratios for profitability, risk, and return.
Table: Ratios
Ratio Analysis
Year 1

Year 2

Year 3

Industry Profile

n.a.

10.89%

11.04%

3.71%

Accounts Receivable
Other Current Assets
Total Current Assets
Long-term Assets
Total Assets

43.51%
1.66%
100.00%
0.00%
100.00%

27.05%
0.93%
100.00%
0.00%
100.00%

19.52%
0.61%
100.00%
0.00%
100.00%

21.90%
45.48%
69.58%
30.42%
100.00%

Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth

8.66%
23.74%
32.40%
67.60%

4.25%
13.31%
17.56%
82.44%

2.99%
8.65%
11.63%
88.37%

35.62%
21.27%
56.89%
43.11%

100.00%
94.43%
63.87%
0.00%
48.54%

100.00%
94.86%
67.34%
0.00%
50.63%

100.00%
95.26%
66.75%
0.00%
54.66%

100.00%
100.00%
85.34%
0.70%
0.35%

11.54
11.54
32.40%
144.76%
97.86%

23.51
23.51
17.56%
77.18%
63.62%

33.49
33.49
11.63%
56.25%
49.71%

1.52
1.20
62.84%
1.09%
2.93%

Sales Growth
Percent of Total Assets

Percent of Sales
Sales
Gross Margin
Selling, General & Administrative Expenses
Advertising Expenses
Profit Before Interest and Taxes
Main Ratios
Current
Quick
Total Debt to Total Assets
Pre-tax Return on Net Worth
Pre-tax Return on Assets
Additional Ratios

Year 1

Year 2

Year 3

Net Profit Margin

Return on Equity

33.33%
101.33%

34.86%
54.02%

37.74%
39.38%

n.a
n.a

4.72
57
9.83
27
2.06

4.72
73
12.17
32
1.28

4.72
73
12.17
29
0.92

n.a
n.a
n.a
n.a
n.a

0.48
0.27

0.21
0.24

0.13
0.26

n.a
n.a

$192,408
52.54

$359,745
60.76

$560,927
72.85

n.a
n.a

0.49
9%
6.52
3.04

0.78
4%
17.15
1.55

1.08
3%
26.96
1.04

n.a
n.a
n.a
n.a

Activity Ratios
Accounts Receivable Turnover
Collection Days
Accounts Payable Turnover
Payment Days
Total Asset Turnover
Debt Ratios
Debt to Net Worth
Current Liab. to Liab.
Liquidity Ratios
Net Working Capital
Interest Coverage
Additional Ratios
Assets to Sales
Current Debt/Total Assets
Acid Test
Sales/Net Worth

Page 23

Wheatland Health Services

Dividend Payout

0.00

0.00

0.00

n.a

Page 24

Appendix
Table: Sales Forecast

Sales 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
Home Health Care Sales
Personal Injury Case Management
Sales
Total Sales

0%
0%

$25,000
$900

$27,000
$1,000

$27,900
$1,200

$29,390
$1,200

$31,000
$1,400

$33,000
$1,500

$35,000
$1,600

$37,000
$1,800

$39,000
$1,900

$41,000
$2,000

$42,900
$2,200

$45,550
$2,500

$25,900

$28,000

$29,100

$30,590

$32,400

$34,500

$36,600

$38,800

$40,900

$43,000

$45,100

$48,050

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

Home Health Care Sales

$1,313

$1,418

$1,465

$1,543

$1,628

$1,733

$1,838

$1,943

$2,048

$2,153

$2,252

$2,391

$113

$125

$150

$150

$175

$188

$200

$225

$238

$250

$275

$313

$1,425

$1,543

$1,615

$1,693

$1,803

$1,920

$2,038

$2,168

$2,285

$2,403

$2,527

$2,704

Personal Injury Case Management

Sales
Subtotal Direct Cost of Sales

Page 1

Appendix
Table: Personnel

Personnel Plan
Month 1
Administrative Director - Elizabeth
Patzer, MSW/MPA
Clinical Director - Kellene Walker, RN
Administrative Assistant
Skilled Nurse
Nurses Aide
Social Worker
Total People
Total Payroll

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

0%

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

0%
0%
0%
0%
0%

$4,333
$1,560
$0
$867
$0
7

$4,333
$1,560
$0
$867
$0
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$876
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$4,333
$1,560
$2,011
$867
$810
7

$6,760

$6,760

$9,581

$9,581

$9,581

$9,590

$9,581

$9,581

$9,581

$9,581

$9,581

$9,581

Page 2

Appendix
Table: General Assumptions

General Assumptions
Plan Month
Current Interest Rate
Long-term Interest
Rate
Tax Rate
Other

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

10

11

Month 12
12

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

Page 3

Appendix
Table: Profit and Loss

Pro Forma Profit and Loss

Month 1
$25,900

Month 2
$28,000

Month 3
$29,100

Month 4
$30,590

Month 5
$32,400

Month 6
$34,500

Month 7
$36,600

Month 8
$38,800

Month 9
$40,900

Month 10
$43,000

Month 11
$45,100

Month 12
$48,050

$1,425

$1,543

$1,615

$1,693

$1,803

$1,920

$2,038

$2,168

$2,285

$2,403

$2,527

$2,704

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$1,425

$1,543

$1,615

$1,693

$1,803

$1,920

$2,038

$2,168

$2,285

$2,403

$2,527

$2,704

$24,475

$26,458

$27,485

$28,897

$30,598

$32,580

$34,563

$36,633

$38,615

$40,598

$42,573

$45,346

94.50%

94.49%

94.45%

94.47%

94.44%

94.43%

94.43%

94.41%

94.41%

94.41%

94.40%

94.37%

$6,760

$6,760

$9,581

$9,581

$9,581

$9,590

$9,581

$9,581

$9,581

$9,581

$9,581

$9,581

$2,493

$2,493

$2,493

$2,493

$2,493

$2,493

$2,493

$2,493

$2,493

$2,493

$2,493

$2,493

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Rent

$200

$200

$200

$200

$200

$200

$200

$200

$200

$200

$200

$200

Heat and Lights

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

Phone

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

Cell Phones

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

Water and Garbage

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

Internet Access

$25

$25

$25

$25

$25

$25

$25

$25

$25

$25

$25

$25

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$100

$100

$100

$100

$100

$100

$100

$100

$100

$100

$100

$100

Sales
Direct Cost of Sales
Other Costs of Sales
Total Cost of Sales
Gross Margin
Gross Margin %
Expenses
Payroll
Payroll Taxes

15%

Depreciation

Professional Liability
Insurance
Workman's Comp

Insurance
Premises and Content
Insurance
Advertising and

Marketing
Meals and Entertainment
Professional
Development
Office Equipment and
Supplies
Contracted Therapists:

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$50

$100

$100

$100

$100

$100

$100

$100

$100

$100

$100

$100

$400

$400

$400

$400

$400

$400

$400

$400

$400

$400

$400

$400

$1,625

$1,625

$1,625

$1,625

$1,625

$1,625

$1,625

$1,625

$1,625

$1,625

$1,625

$1,625

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

Total Operating Expenses

$14,204

$14,204

$17,025

$17,025

$17,025

$17,034

$17,025

$17,025

$17,025

$17,025

$17,025

$17,025

Profit Before Interest and

Taxes
EBITDA

$10,271

$12,254

$10,461

$11,872

$13,573

$15,546

$17,538

$19,608

$21,590

$23,573

$25,548

$28,321

$10,271

$12,254

$10,461

$11,872

$13,573

$15,546

$17,538

$19,608

$21,590

$23,573

$25,548

$28,321

$333

$333

$333

$333

$333

$333

$333

$333

$333

$333

$333

$333

$2,981

$3,576

$3,038

$3,462

$3,972

$4,564

$5,161

$5,782

$6,377

$6,972

$7,564

$8,396

OT/PT/ST
Nursing Supplies

Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales

15%

$50
$100
15%

$6,957

$8,344

$7,089

$8,077

$9,268

$10,649

$12,043

$13,492

$14,880

$16,268

$17,650

$19,592

26.86%

29.80%

24.36%

26.41%

28.60%

30.87%

32.90%

34.77%

36.38%

37.83%

39.14%

40.77%

Page 4

Appendix

Page 5

Appendix
Table: Cash Flow

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

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Cash from Receivables

$0

$863

$25,970

$28,037

$29,150

$30,650

$32,470

$34,570

$36,673

$38,870

$40,970

$43,070

Subtotal Cash from Operations

$0

$863

$25,970

$28,037

$29,150

$30,650

$32,470

$34,570

$36,673

$38,870

$40,970

$43,070

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

New Other Liabilities (interest-free)

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

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

$0

$863

$25,970

$28,037

$29,150

$30,650

$32,470

$34,570

$36,673

$38,870

$40,970

$43,070

Month 10

Month 11

Month 12

Additional Cash Received

Sales Tax, VAT, HST/GST Received
New Current Borrowing

Expenditures

0.00%

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Expenditures from Operations

Cash Spending

$6,760

$6,760

$9,581

$9,581

$9,581

$9,590

$9,581

$9,581

$9,581

$9,581

$9,581

$9,581

$406

$12,207

$12,880

$12,446

$12,952

$13,575

$14,284

$15,001

$15,750

$16,462

$17,175

$17,902

$7,166

$18,967

$22,461

$22,028

$22,533

$23,165

$23,866

$24,582

$25,332

$26,044

$26,756

$27,483

Sales Tax, VAT, HST/GST Paid Out

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Principal Repayment of Current

Borrowing
Other Liabilities Principal
Repayment
Long-term Liabilities Principal
Repayment
Purchase Other Current Assets

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$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

$7,166

$18,967

$22,461

$22,028

$22,533

$23,165

$23,866

$24,582

$25,332

$26,044

$26,756

$27,483

Bill Payments
Subtotal Spent on Operations
Additional Cash Spent

Subtotal Cash Spent

Page 6

Appendix
Net Cash Flow

($7,166)

($18,104)

Cash Balance

$37,433

$19,329

$3,509

$6,009

$6,616

$7,485

$8,604

$9,988

$11,342

$12,826

$14,214

$15,587

$22,838

$28,847

$35,463

$42,948

$51,553

$61,541

$72,883

$85,709

$99,923

$115,509

Month 10

Month 11

Table: Balance Sheet

Pro Forma Balance Sheet

Month 1
Assets

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 12

Starting
Balances

Current Assets
Cash
Accounts Receivable
Other Current Assets
Total Current Assets

$44,599
$0
$3,500
$48,099

$37,433
$25,900
$3,500
$66,833

$19,329
$53,037
$3,500
$75,865

$22,838
$56,167
$3,500
$82,504

$28,847
$58,720
$3,500
$91,067

$35,463
$61,970
$3,500
$100,933

$42,948
$65,820
$3,500
$112,268

$51,553
$69,950
$3,500
$125,003

$61,541
$74,180
$3,500
$139,221

$72,883
$78,407
$3,500
$154,789

$85,709
$82,537
$3,500
$171,745

$99,923
$86,667
$3,500
$190,089

$115,509
$91,647
$3,500
$210,656

$0
$0
$0
$48,099

$0
$0
$0
$66,833

$0
$0
$0
$75,865

$0
$0
$0
$82,504

$0
$0
$0
$91,067

$0
$0
$0
$100,933

$0
$0
$0
$112,268

$0
$0
$0
$125,003

$0
$0
$0
$139,221

$0
$0
$0
$154,789

$0
$0
$0
$171,745

$0
$0
$0
$190,089

$0
$0
$0
$210,656

Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
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
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities
Long-term Liabilities
Total Liabilities
Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital
Net Worth

$0
$0
$0
$0

$11,777
$0
$0
$11,777

$12,465
$0
$0
$12,465

$12,015
$0
$0
$12,015

$12,500
$0
$0
$12,500

$13,099
$0
$0
$13,099

$13,785
$0
$0
$13,785

$14,476
$0
$0
$14,476

$15,202
$0
$0
$15,202

$15,891
$0
$0
$15,891

$16,579
$0
$0
$16,579

$17,273
$0
$0
$17,273

$18,248
$0
$0
$18,248

$50,000
$50,000

$50,000
$61,777

$50,000
$62,465

$50,000
$62,015

$50,000
$62,500

$50,000
$63,099

$50,000
$63,785

$50,000
$64,476

$50,000
$65,202

$50,000
$65,891

$50,000
$66,579

$50,000
$67,273

$50,000
$68,248

$20,000
($21,901)
$0
($1,901)
$48,099

$20,000
($21,901)
$6,957
$5,056
$66,833

$20,000
($21,901)
$15,301
$13,400
$75,865

$20,000
($21,901)
$22,390
$20,489
$82,504

$20,000
($21,901)
$30,467
$28,566
$91,067

$20,000
($21,901)
$39,735
$37,834
$100,933

$20,000
($21,901)
$50,384
$48,483
$112,268

$20,000
($21,901)
$62,427
$60,526
$125,003

$20,000
($21,901)
$75,920
$74,019
$139,221

$20,000
($21,901)
$90,800
$88,899
$154,789

$20,000
($21,901)
$107,067
$105,166
$171,745

$20,000
($21,901)
$124,718
$122,817
$190,089

$20,000
($21,901)
$144,309
$142,408
$210,656

$13,400

$20,489

$28,566

$37,834

$48,483

$60,526

$74,019

$88,899

$105,166

$122,817

$142,408

($1,901)

$5,056

Page 7