Diagnostic Tools - Year 1
Prepared By: Company Name:
Sam Miller Aviation Flight Academy
General Financing Assumptions Value Findings
Owner's Cash Injection into the Business 0.0% Owner's injection might be too low in relation to the amount of money needed
Cash Request as percent of Total Required Funds 2.0% Cash request seems reasonable with respect to total request
     
Loan Assumptions Value Findings
Commercial Loan Interest rate 9.0% Interest rate seems reasonable
Commercial Loan Term in Months                         84 Loan term seems within range for this type of loan
Commercial Mortgage Interest rate 9.0% Interest rate seems reasonable
Commercial Mortgage Term in Months 240 Loan term seems within range for this type of loan
Debt-Service Coverage -3021.5% Calculated loan payments relative to operating profit seem reasonable
     
Income Statement Value Findings
Gross Margin as a Percent of Sales 30.6% Gross margin percentage seems reasonable
Owner's Compensation Lower Limit Check  $          661,440 An owner's compensation amount has been established
Owner's Compensation Upper Limit Check 1.3% Owner's compensation seems reasonable
Advertising Expense Levels as a Percent of Sales 2.5% Advertising as a percent of sales seems reasonable
Profitability Levels  $    50,284,812 The business is showing a profit
Profitability as a Percent of Sales 21.0% The projection may be too aggressive in stating profitability
     
Cash Flow Statement Value Findings
Desired Operating cash Flow Levels  $                        - The financial projection provides the desired level of cash flow
Line of Credit Drawdowns  $                        - The business doesn't seem to require a line of credit
Accounts Receivable Ratio to Sales 2.1% Accounts receivable amount as a percent of sales seems reasonable
     
Balance Sheet Value Findings
Does the Year 1 Balance Sheet Balance?  $                        - The balance sheet does balance
Debt to Equity Ratio -2.9% Very comfortable
     
Breakeven Analysis Value Findings
Do Sales Exceed the Breakeven Level?  $  180,557,211 The sales projection exceeds the projected break-even sales level