Venture Budgeting and Forecasting Paper

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University of Phoenix Material

 

Venture Budgeting and Forecasting Paper

 

Resources: Kudler Opening Budget

Write a 700- to 900-word paper in APA format in which you do the following:

 

·         Illustrate how your venture would perform by estimating the revenue and expense to calculate operating profit or loss. Include estimates of your venture’s main sources of revenue and the expenses expected in the main cost categories such as the cost of goods, sales and marketing, labor, rent, maintenance, and any other significant expenses.

 

·         Illustrate your venture’s startup costs by estimating a preopening budget—also termed development budget—that includes startup costs such as building and construction, Web site development, preopening marketing, equipment, merchandise, preopening operations, research and development, working capital, and any other significant preopening expenses.An example of a preopening budget may be found in the materials listed on the course page for the University of Phoenix student Web site for Week Two named Kudler Opening Budget.

 

·         Develop financial planning goals by illustrating how your venture would be initially funded by using cash on hand, debt, venture capital, or a combination of these. Use a mortgage calculator found on the Internet and calculate your loan payments. Include these expenses in your Operating Budget. Use the information below to help in your calculations:

 

Building and Construction Estimation*

Remodeling Fees

$200 per Square Foot

New Building Construction Fees

$450 per Square Foot

*Multiply square footage of small business by fee for estimation.

 

Interest Information

10 Year bank Note (Debt)

7.5% Interest

5 Year Venture Capital Loan

15% Interest

 

Examples of Profit Split for Venture Capital Partnerships*

Example 1

Venture Capital Investment 1

$300,000

Cost to Develop Business 1

$1,000,000

Venture Capital Profits 1

30% of Business Profits

Example 2

Venture Capital Investment 2

$500,000

Cost to Develop Business 2

$2,000,000

Venture Capital Profits 2

25% of Business Profits

*Profit split is commensurate with the ratio of investment.

 

Post your assignment as a Microsoft® Word attachment.

 

 University of Phoenix Material

 

 

Venture Budgeting and Forecasting Paper

 

Resources: Kudler Opening Budget

Write a 700- to 900-word paper in APA format in which you do the following:

 

·         Illustrate how your venture would perform by estimating the revenue and expense to calculate operating profit or loss. Include estimates of your venture’s main sources of revenue and the expenses expected in the main cost categories such as the cost of goods, sales and marketing, labor, rent, maintenance, and any other significant expenses.

 

·         Illustrate your venture’s startup costs by estimating a preopening budget—also termed development budget—that includes startup costs such as building and construction, Web site development, preopening marketing, equipment, merchandise, preopening operations, research and development, working capital, and any other significant preopening expenses.An example of a preopening budget may be found in the materials listed on the course page for the University of Phoenix student Web site for Week Two named Kudler Opening Budget.

 

·         Develop financial planning goals by illustrating how your venture would be initially funded by using cash on hand, debt, venture capital, or a combination of these. Use a mortgage calculator found on the Internet and calculate your loan payments. Include these expenses in your Operating Budget. Use the information below to help in your calculations:

 

Building and Construction Estimation*

Remodeling Fees

$200 per Square Foot

New Building Construction Fees

$450 per Square Foot

*Multiply square footage of small business by fee for estimation.

 

Interest Information

10 Year bank Note (Debt)

7.5% Interest

5 Year Venture Capital Loan

15% Interest

 

Examples of Profit Split for Venture Capital Partnerships*

Example 1

Venture Capital Investment 1

$300,000

Cost to Develop Business 1

$1,000,000

Venture Capital Profits 1

30% of Business Profits

Example 2

Venture Capital Investment 2

$500,000

Cost to Develop Business 2

$2,000,000

Venture Capital Profits 2

25% of Business Profits

*Profit split is commensurate with the ratio of investment.

 

Post your assignment as a Microsoft® Word attachment.

 University of Phoenix Material

 

 

Venture Budgeting and Forecasting Paper

 

Resources: Kudler Opening Budget

Write a 700- to 900-word paper in APA format in which you do the following:

 

·         Illustrate how your venture would perform by estimating the revenue and expense to calculate operating profit or loss. Include estimates of your venture’s main sources of revenue and the expenses expected in the main cost categories such as the cost of goods, sales and marketing, labor, rent, maintenance, and any other significant expenses.

 

·         Illustrate your venture’s startup costs by estimating a preopening budget—also termed development budget—that includes startup costs such as building and construction, Web site development, preopening marketing, equipment, merchandise, preopening operations, research and development, working capital, and any other significant preopening expenses.An example of a preopening budget may be found in the materials listed on the course page for the University of Phoenix student Web site for Week Two named Kudler Opening Budget.

 

·         Develop financial planning goals by illustrating how your venture would be initially funded by using cash on hand, debt, venture capital, or a combination of these. Use a mortgage calculator found on the Internet and calculate your loan payments. Include these expenses in your Operating Budget. Use the information below to help in your calculations:

 

Building and Construction Estimation*

Remodeling Fees

$200 per Square Foot

New Building Construction Fees

$450 per Square Foot

*Multiply square footage of small business by fee for estimation.

 

Interest Information

10 Year bank Note (Debt)

7.5% Interest

5 Year Venture Capital Loan

15% Interest

 

Examples of Profit Split for Venture Capital Partnerships*

Example 1

Venture Capital Investment 1

$300,000

Cost to Develop Business 1

$1,000,000

Venture Capital Profits 1

30% of Business Profits

Example 2

Venture Capital Investment 2

$500,000

Cost to Develop Business 2

$2,000,000

Venture Capital Profits 2

25% of Business Profits

*Profit split is commensurate with the ratio of investment.

 

Post your assignment as a Microsoft® Word attachment.

 

University of Phoenix Faculty Material   
    
 Kudler Opening Budget Startup Costs 
    
      
 Construction        
 Site preparation                 100,000  
 Building              1,000,000  
 Trade Fixtures                 400,000      
 20% CONTINGENCY                 300,000  
   SUBTOTAL:   1,800,000
    
 Operating Capital    
 Marketing/PR                   50,000  
 Launch Event                   25,000  
 Equipment                   50,000  
 Inventory                 750,000  
 Operating Supplies                   10,000  
 Legal fees                   25,000  
 Permits                   10,000  
 Insurance                   25,000  
 Preopening Salaries and Travel                 125,000  
 10% Contingency                 107,000  
   SUBTOTAL:   1,177,000
    
 Occupancy Cost    
 R E Taxes                   12,000  
 Utilities                   10,000  
   SUBTOTAL:       22,000
    
 TOTAL  2,999,000  
    
    
    
 Capitalization Plan    
    
 Cash from Principle Owners                 300,000  
 Cash from Venture Capital Partners                 600,000 Preferred return of 80% of net profit until principle is paid, then 10% of net profits  
 Bank Loan              2,100,000 7.5% APR on a 15-year term  
              3,000,000  
  • 9 years ago
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