Breakaway Bicycle Company, Inc.

Balance Sheet - December 31, 2000

Assets

Current Assets:
Cash $50,000
Accounts Receivable $20,000
Less: Reserve for Bad Debts 5,000 15,000
Merchandise Inventory 5,000
Prepaid Expenses 500
Notes Receivable 0
Total Current Assets $70,500

Fixed Assets:
Vehicles 15,000
Less: Accumulated Depreciation 15,000 0

Furniture and Fixtures 15,000

Less: Accumulated Depreciation 5,000 10,000

Equipment 100,000
Less: Accumulated Depreciation 48,000 52,000

Total Fixed Assets 62,000

Other Assets:
Goodwill 0
Total Other Assets 0

Total Assets $132,500

Liabilities and Capital

Current Liabilities:
Accounts Payable $4,200
Sales Taxes Payable 2,000
Payroll Taxes Payable 1,523
Accrued Wages Payable 4,125
Unearned Revenues 20,000
Total Current Liabilities $31,848

Long-Term Liabilities:
Long-Term Notes Payable 0
Mortgage Payable 0
Total Long-Term Liabilities 0

Total Liabilities 31,848

Capital:
Owner's Equity 100,652
Total Capital 100,652

Total Liabilities and Capital $132,500

0
 Breakaway Bicycle Company, Inc.
Income Statement - 12/31/00

Revenue:
Gross Sales $1,057,008
Less: Sales Returns and Allowances 22,890
Net Sales 1,034,118

Cost of Goods Sold:

Beginning Inventory $15,000
Add: Purchases 124,500
Freight-in 2,500
Direct Labor 241,000
Indirect Expenses 0
383,000
Less: Ending Inventory 16,500
Cost of Goods Sold 366,500

Gross Profit (Loss) 667,618

Expenses:
Advertising 47,000
Amortization 0
Bad Debts 42,280
Bank Charges 3,600
Charitable Contributions 2,500
Commissions 0
Contract Labor 0
Credit Card Fees 2,400
Delivery Expenses 65,760
Depreciation 10,000
Dues and Subscriptions 600
Insurance 7,200
Interest 0
Maintenance 2,400
Miscellaneous 0
Office Expenses 2,400
Operating Supplies 2,400
Payroll Taxes 42,500
Permits and Licenses 1,200
Postage 2,400
Professional Fees 2,400
Property Taxes 0
Rent 24,000
Repairs 0
Telephone 5,200
Travel 9,000
Utilities 6,000
Vehicle Expenses 2,510
Wages 205,000
Total Expenses 488,750

Net Operating Income 178,868

Other Income:
Gain (Loss) on Sale of Assets 0
Interest Income 0
Total Other Income 0

Net Income (Loss) $178,868

 Breakaway Bicycle Company, Inc.
Cash Flow Worksheet for 2000

January February March April May June July August September October November December Total
Beginning Cash Balance $3,600 $21,801 $51,143 $68,343 $89,211 $115,221 $137,331 $167,270 $177,785 $183,947 $180,315
Cash Inflows (Income):
Accts. Rec. Collections 8,500 8,000 7,000 7,850 7,952 6,210 5,260 9,850 9,852 7,888 9,520 7,550 95,432
Sales & Receipts 65,000 75,000 85,996 86,000 84,520 85,115 88,500 83,339 70,520 62,500 55,000 81,000 922,490

Total Cash Inflows $73,500 $83,000 $92,996 $93,850 $92,472 $91,325 $93,760 $93,189 $80,372 $70,388 $64,520 $88,550 $1,017,922
Available Cash Balance $73,500 $86,600 $114,797 $144,993 $160,815 $180,536 $208,981 $230,520 $247,642 $248,173 $248,467 $268,865
Cash Outflows (Expenses):
Advertising 1,500 2,500 1,000 3,000 1,500 4,500 1,500 2,500 1,000 3,000 1,500 4,500 28,000
Bank Service Charges 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Credit Card Fees 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Delivery 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 54,000
Health Insurance 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 14,400
Insurance 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Inventory Purchases 13,050 14,550 7,804 18,800 16,654 14,445 14,800 13,200 11,587 12,589 12,300 11,899 161,678
Miscellaneous 15,000 7,899 12,500 15,000 8,500 6,520 5,500 7,700 5,420 8,787 6,002 6,000 104,828
Office 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Payroll 28,000 28,000 28,000 28,000 28,000 28,000 28,000 28,000 28,000 28,000 28,000 28,000 336,000
Payroll Taxes 2,800 2,800 2,800 2,800 2,800 2,800 2,800 2,800 2,800 2,800 2,800 2,800 33,600
Rent or Lease 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 14,400
Subscriptions & Dues 50 50 50 50 50 50 50 50 50 50 50 50 600
Supplies 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Taxes & Licenses 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Utilities & Telephone 500 500 500 500 500 500 500 500 500 500 500 500 6,000

Subtotal $69,400 $64,799 $61,154 $76,650 $66,504 $65,315 $61,650 $63,250 $57,857 $64,226 $59,652 $62,249 $772,706
Other Cash Outflows
Owner's Draw 500 2,500 5,100 10,000 12,000 8,500 18,750 57,350

Subtotal $500 $ $2,500 $0 $5,100 $0 $10,000 $0 $12,000 $0 $8,500 $18,750 $57,350

Total Cash Outflows $69,900 $64,799 $63,654 $76,650 $71,604 $65,315 $71,650 $63,250 $69,857 $64,226 $68,152 $80,999 $830,056
Ending Cash Balance $3,600 $21,801 $51,143 $68,343 $89,211 $115,221 $137,331 $167,270 $177,785 $183,947 $180,315 $187,866
 Breakaway Bicycle Company, Inc.
Pro Forma Balance Sheet - 12/31/00

Assets

Current Assets:
Cash $452,578
Accounts Receivable $74,520
Less: Reserve for Bad Debts 7,452 67,068
Merchandise Inventory 21,000
Prepaid Expenses 5,000
Notes Receivable 0
Total Current Assets $545,646

Fixed Assets:
Vehicles 0
Less: Accumulated Depreciation 0 0

Furniture and Fixtures 25,000

Less: Accumulated Depreciation 7,000 18,000

Equipment 160,000
Less: Accumulated Depreciation 54,000 106,000

Buildings 0
Less: Accumulated Depreciation 0 0

Land 0
Total Fixed Assets 124,000

Other Assets:
Goodwill 0
Total Other Assets 0

Total Assets $669,646

Liabilities and Capital

Current Liabilities:
Accounts Payable $5,500
Sales Taxes Payable 400
Payroll Taxes Payable 16,000
Accrued Wages Payable 55,880
Unearned Revenues 15,060
Short-Term Notes Payable 0
Short-Term Bank Loan Payable 0
Total Current Liabilities $92,840

Long-Term Liabilities:
Long-Term Notes Payable 75,000
Mortgage Payable 0
Total Long-Term Liabilities 75,000

Total Liabilities 167,840

Capital:
Owner's Equity 501,806
Total Capital 501,806

Total Liabilities and Capital $669,646

0
 Breakaway Bicycle Company, Inc.
Pro Forma Balance Sheet - 12/31/01

Assets

Current Assets:
Cash $815,840
Accounts Receivable $22,000
Less: Reserve for Bad Debts 1,980 20,020
Merchandise Inventory 15,000
Prepaid Expenses 5,200
Notes Receivable 0
Total Current Assets $856,060

Fixed Assets:
Vehicles 0
Less: Accumulated Depreciation 0 0

Furniture and Fixtures 25,000

Less: Accumulated Depreciation 9,000 16,000

Equipment 160,000
Less: Accumulated Depreciation 60,000 100,000

Buildings 0
Less: Accumulated Depreciation 0 0

Land 0
Total Fixed Assets 116,000

Other Assets:
Goodwill 0
Total Other Assets 0

Total Assets $972,060

Liabilities and Capital

Current Liabilities:
Accounts Payable $7,500
Sales Taxes Payable 800
Payroll Taxes Payable 17,500
Accrued Wages Payable 60,000
Unearned Revenues 78,000
Short-Term Notes Payable 0
Short-Term Bank Loan Payable 0
Total Current Liabilities $163,800

Long-Term Liabilities:
Long-Term Notes Payable 50,000
Mortgage Payable 0
Total Long-Term Liabilities 50,000

Total Liabilities 213,800

Capital:
Owner's Equity 758,260
Total Capital 758,260

Total Liabilities and Capital $972,060

0
 Breakaway Bicycle Company, Inc.
Revenue Projections
2000
January February March April May June July August September October November December
NUMBER OF: Total
Road Frames 30 26 30 34 36 34 38 32 29 26 22 44 377
Mountain Frames 40 38 38 41 43 41 40 36 32 29 19 48 445

INCOME GENERATED FROM:

European Sales -Road Frames ($1,800/frame) $10,800 $9,360 $10,800 $12,240 $12,960 $12,240 $12,240 $11,520 $10,440 $9,360 $7,920 $15,840
U.S. Sales - Road ($1,800/frame) $43,200 $37,440 $43,200 $48,960 $51,840 $48,960 $48,960 $46,080 $41,760 $37,440 $31,680 $63,360
European Sales - Mountain ($1,600/frame) $32,000 $30,400 $30,400 $32,800 $34,400 $32,800 $32,000 $28,800 $25,600 $23,200 $15,200 $38,400
U.S. Sales - Mountain ($1,600/frame) $32,000 $30,400 $30,400 $32,800 $34,400 $32,800 $32,000 $28,800 $25,600 $23,200 $15,200 $38,400
$118,000 $107,600 $114,800 $126,800 $133,600 $126,800 $125,200 $115,200 $103,400 $93,200 $70,000 $156,000 $1,390,600

2001
January February March April May June July August September October November December
NUMBER OF: Total
Road Frames 40 35 36 38 42 40 38 35 32 29 25 60 450
Mountain Frames 44 42 41 46 48 45 44 38 35 32 26 65 506

INCOME GENERATED FROM:

European Sales -Road Frames ($1,800/frame) $14,400 $12,600 $12,960 $13,680 $15,120 $14,400 $13,680 $12,600 $11,520 $10,440 $9,000 $21,600
U.S. Sales - Road ($1,800/frame) $57,600 $50,400 $51,840 $54,720 $60,480 $57,600 $54,720 $50,400 $46,080 $41,760 $36,000 $86,400
European Sales - Mountain ($1,600/frame) $35,200 $33,600 $32,800 $36,800 $38,400 $36,000 $35,200 $30,400 $28,000 $25,600 $20,800 $52,000
U.S. Sales - Mountain ($1,600/frame) $35,200 $33,600 $32,800 $36,800 $38,400 $36,000 $35,200 $30,400 $28,000 $25,600 $20,800 $52,000
$142,400 $130,200 $130,400 $142,000 $152,400 $144,000 $138,800 $123,800 $113,600 $103,400 $86,600 $212,000 $1,619,600
 Projected Revenue - 2000

$160,000

$140,000

M $120,000
o
n
t $100,000
h
l
y $80,000

R
e $60,000
v
e
n $40,000
u
e
$20,000

$0
Januar Februa March April May June July August Septe Octobe Novem Decem
y ry mber r ber ber
 Projected Revenue - 2001

$250,000

$200,000
M
o
n
t
h $150,000
l
y

R
e $100,000
v
e
n
u
e $50,000

$0
Januar Februa March April May June July August Septe Octobe Novem Decem
y ry mber r ber ber
 Breakaway Bicycle Company, Inc.
Projected Profit and Loss Statement - 2000

January February March April May June July August September October November
Revenue:
Gross Sales $118,000 107,600 $114,800 $126,800 $133,800 $126,800 $125,200 $115,200 $103,400 $93,200 $70,000
Less: Sales Returns and Allowances 5,900 5,380 5,740 6,340 6,690 6,340 6,260 5,760 5,170 4,660 3,500
Net Sales $112,100 $102,220 $109,060 $120,460 $127,110 $120,460 $118,940 $109,440 $98,230 $88,540 $66,500

Cost of Goods Sold:

Materials 14,160 12,912 13,776 15,216 16,056 15,216 15,024 13,824 12,408 11,184 8,400
Labor 14,160 12,912 13,776 15,216 16,056 15,216 15,024 13,824 12,408 11,184 8,400
Other Direct Expenses 5,310 4,842 5,166 5,706 6,021 5,706 5,634 5,184 4,653 4,194 3,150
Indirect Expenses 1,770 1,614 1,722 1,902 2,007 1,902 1,878 1,728 1,551 1,398 1,050
Cost of Goods Sold $35,400 $32,280 $34,440 $38,040 $40,140 $38,040 $37,560 $34,560 $31,020 $27,960 $21,000

Gross Profit (Loss) $76,700 $69,940 $74,620 $82,420 $86,970 $82,420 $81,380 $74,880 $67,210 $60,580 $45,500

Expenses:
Advertising 2,500 2,500 3,000 5,000 3,000 3,000 2,500 2,000 2,000 3,000 4,000
Bad Debts 5,605 5,111 5,453 6,023 6,356 6,023 5,947 5,472 4,912 4,427 3,325
Bank Charges 300 300 300 300 300 300 300 300 300 300 300
Charitable Contributions 100 100 100 100 100 100 100 100 100 100 100
Credit Card Fees 0 0 0 0 0 0 0 0 0 0 0
Delivery Expenses 200 200 200 200 200 200 200 200 200 200 200
Depreciation 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480
Dues and Subscriptions 888 888 888 888 888 888 888 888 888 888 888
Insurance 50 50 50 50 50 50 50 50 50 50 50
Interest 600 600 600 600 600 600 600 600 600 600 600
Maintenance 401 401 401 401 401 401 401 401 401 401 401
Miscellaneous 200 200 200 200 200 200 200 200 200 200 200
Office Expenses 500 500 500 500 500 500 500 500 500 500 500
Operating Supplies 200 200 200 200 200 200 200 200 200 200 200
Payroll Taxes 200 200 200 200 200 200 200 200 200 200 200
Permits and Licenses 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792
Postage 100 100 100 100 100 100 100 100 100 100 100
Rent 200 200 200 200 200 200 200 200 200 200 200
Telephone 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200
Travel 400 400 400 400 400 400 400 400 400 400 400
Utilities 200 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000
Wages 500 500 500 500 500 500 500 500 500 500 500
Wages 23,757 25,005 37,917 22,701 21,861 22,701 22,893 24,093 25,509 26,733 29,517
Total Expenses 49,373 50,927 64,681 52,035 49,528 50,035 49,651 49,876 50,932 52,671 55,353

Net Operating Income 27,327 19,013 9,939 30,385 37,443 32,385 31,729 25,004 16,279 7,909 (9,853)

Other Income:
Gain (Loss) on Sale of Assets 0 0 0 0 0 0 0 0 0 0 0
Interest Income 0 0 0 0 0 0 0 0 0 0 0
Total Other Income 0 0 0 0 0 0 0 0 0 0 0

Net Income (Loss) $27,327 19,013 $9,939 $30,385 $37,443 $32,385 $31,729 $25,004 $16,279 $7,909 ($9,853)
Cumulative Net Income (Loss) $27,327 46,340 $56,279 $86,664 $124,107 $156,492 $188,221 $213,225 $229,504 $237,413 $227,560
 Breakaway Bicycle Company, Inc.
Projected Profit and Loss Statement - 2001

January February March April May June July August September October November
Revenue:
Gross Sales $142,400 $130,200 $130,400 $142,000 $152,400 $144,000 $138,800 $123,800 $113,600 $103,400 $86,600
Less: Sales Returns and Allowances 7,120 6,510 6,520 7,100 7,620 7,200 6,940 6,190 5,680 5,170 4,330
Net Sales $135,280 $123,690 $123,880 $134,900 $144,780 $136,800 $131,860 $117,610 $107,920 $98,230 $82,270

Cost of Goods Sold:

Materials 17,088 15,624 15,648 17,040 18,288 15,624 15,648 17,040 18,288 15,624 15,648
Labor 17,088 15,624 15,648 17,040 18,288 15,624 15,648 17,040 18,288 15,624 15,648
Other Direct Expenses 6,408 5,859 5,868 6,390 6,858 5,859 5,868 6,390 6,858 5,859 5,868
Indirect Expenses 2,136 1,953 1,956 2,130 2,286 1,953 1,956 2,130 2,286 1,953 1,956
Cost of Goods Sold $42,720 $39,060 $39,120 42,600 45,720 39,060 39,120 42,600 45,720 $39,060 $39,120

Gross Profit (Loss) $92,560 $84,630 $84,760 $92,300 $99,060 $97,740 $92,740 $75,010 $62,200 $59,170 $43,150

Expenses:
Advertising 2,700 2,700 3,100 5,200 3,100 3,100 2,700 2,100 2,100 3,100 4,200
Bad Debts 6,764 6,185 6,194 6,745 7,239 6,840 6,593 5,881 5,396 4,912 4,114
Bank Charges 300 300 300 300 300 300 300 300 300 300 300
Charitable Contributions 100 100 100 100 100 100 100 100 100 100 100
Credit Card Fees 200 200 200 200 200 200 200 200 200 200 200
Delivery Expenses 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000
Depreciation 888 888 888 888 888 888 888 888 888 888 888
Dues and Subscriptions 50 50 50 50 50 50 50 50 50 50 50
Insurance 600 600 600 600 600 600 600 600 600 600 600
Interest 401 401 401 401 401 401 401 401 401 401 401
Maintenance 200 200 200 200 200 200 200 200 200 200 200
Miscellaneous 500 500 500 500 500 500 500 500 500 500 500
Office Expenses 200 200 200 200 200 200 200 200 200 200 200
Operating Supplies 200 200 200 200 200 200 200 200 200 200 200
Payroll Taxes 2,750 2,923 2,894 2,754 2,630 2,896 2,894 2,754 2,630 2,896 2,894
Permits and Licenses 100 100 100 100 100 100 100 100 100 100 100
Postage 400 400 400 400 400 400 400 400 400 400 400
Rent 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200 3,200
Telephone 400 400 400 400 400 400 400 400 400 400 400
Travel 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 500 500 500
Utilities 500 500 500 500 500 500 500 500 500 500 500
Wages 27,495 29,229 28,935 27,543 26,295 28,959 28,935 27,543 26,295 28,959 28,935
Total Expenses $54,948 $56,276 $56,362 $57,481 $54,503 $57,034 $56,361 $53,517 $51,160 $54,606 $54,882

Net Operating Income $37,613 $28,354 $28,399 $34,819 $44,558 $40,706 $36,380 $21,493 $11,041 $4,564 ($11,732)

Other Income:
Gain (Loss) on Sale of Assets 0 0 0 0 0 0 0 0 0 0 0
Interest Income 0 0 0 0 0 0 0 0 0 0 0
Total Other Income 0 0 0 0 0 0 0 0 0 0 0

Net Income (Loss) $37,613 $28,354 $28,399 $34,819 $44,558 $40,706 $36,380 $21,493 $11,041 $4,564 ($11,732)
Cumulative Net Income (Loss) $37,613 $65,967 $94,366 $129,185 $173,743 $214,449 $250,829 $272,321 $283,362 $287,927 $276,195
 Breakaway Bicycle Company, Inc.
Cash Flow Budget Worksheet - 2000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total
Beginning Cash Balance $63,642 $84,601 $109,750 $141,881 $181,622 $216,656 $250,705 $272,794 $291,096 $300,494 $291,703
Cash Inflows (Income):
Accounts Receivable Collections 0 5,605 5,111 5,453 6,023 6,356 6,023 5,947 5,472 4,912 4,427 3,325 58,654
Loan Proceeds 100,000 100,000
Sales & Receipts 106,200 96,840 103,320 114,120 120,420 114,120 112,680 98,496 93,060 83,880 63,000 140,400 1,246,536
Other: 0
0
0
Total Cash Inflows $206,200 $102,445 $108,431 $119,573 $126,443 $120,476 $118,703 $104,443 $98,532 $88,792 $67,427 $143,725 $1,405,190
Available Cash Balance $206,200 $166,087 $193,032 $229,323 $268,324 $302,098 $335,359 $355,148 $371,326 $379,888 $367,921 $435,428
Cash Outflows (Expenses):
Advertising 2,500 2,500 3,000 5,000 3,000 3,000 2,500 2,000 2,000 3,000 4,000 5,000 37,500
Bank Service Charges 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Credit Card Fees 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Delivery 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 5,480 65,760
Health Insurance 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 36,000
Insurance 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Interest 401 401 401 401 401 401 401 401 401 401 401 401 4,812
Inventory Purchases 14,160 12,912 13,776 15,216 16,056 15,216 15,024 13,824 12,408 11,184 8,400 18,720 166,896
Miscellaneous 7,580 6,956 7,388 8,108 8,528 8,108 8,012 7,412 6,704 6,092 4,700 9,860 89,448
Office 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Payroll 37,917 37,917 37,917 37,917 37,917 37,917 37,917 37,917 37,917 37,917 37,917 37,917 455,004
Payroll Taxes 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 3,792 45,504
Professional Fees 0 0 0 0 0 0 0 0 0 0 0 0 0
Rent or Lease 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 24,000
Subscriptions & Dues 50 50 50 50 50 50 50 50 50 50 50 50 600
Supplies 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Taxes & Licenses 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Utilities & Telephone 900 900 900 900 900 900 900 900 900 900 900 900 10,800
Other: 0
Travel 200 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 200 10,400
Maintenance 200 200 200 200 200 200 200 200 200 200 200 200 2,400
0
Subtotal $79,780 $78,708 $80,504 $84,664 $83,924 $82,664 $81,876 $79,576 $77,452 $76,616 $73,440 $89,120 $968,324
Other Cash Out Flows:
Capital Purchases 60,000 60,000
Loan Principal 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 33,336
Owner's Draw 0
Other: 0
0
Subtotal $62,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $93,336
Total Cash Outflows $142,558 $81,486 $83,282 $87,442 $86,702 $85,442 $84,654 $82,354 $80,230 $79,394 $76,218 $91,898 $1,061,660
Ending Cash Balance $63,642 $84,601 $109,750 $141,881 $181,622 $216,656 $250,705 $272,794 $291,096 $300,494 $291,703 $343,530

Note 1. Breakaway hopes to secure a $100,000 loan to purchase and install three new workstations to handle the expected increase in bicycle orders.
The additional $40,000 would provide working capital during the expansion period. The loan would be for three years at a 9% interest rate.
 Breakaway Bicycle Company, Inc.
Cash Flow Budget Worksheet - 2001

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total
Beginning Cash Balance $32,058 $60,937 $89,066 $123,789 $168,670 $210,320 $247,321 $269,258 $280,168 $284,334 $271,759
Cash Inflows (Income):
Accts. Rec. Collections 0 5,605 5,111 5,453 6,023 6,356 6,023 5,947 5,472 4,912 4,427 3,325 58,654
Loan Proceeds 0
Sales & Receipts 128,160 117,180 117,360 127,800 137,160 129,600 124,920 111,420 102,240 93,060 77,940 190,800 1,457,640
Other: 0

Total Cash Inflows $128,160 $122,785 $122,471 $133,253 $143,183 $135,956 $130,943 $117,367 $107,712 $97,972 $82,367 $194,125 $1,516,294
Available Cash Balance $128,160 $154,843 $183,408 $222,319 $266,972 $304,626 $341,263 $364,688 $376,970 $378,140 $366,701 $465,884

Cash Outflows (Expenses):

Advertising 2,700 2,700 3,100 5,200 3,100 3,100 2,700 2,100 2,100 3,100 4,200 5,500 39,600
Bank Service Charges 300 300 300 300 300 300 300 300 300 300 300 300 3,600
Credit Card Fees 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Delivery 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 6,000 72,000
Health Insurance 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 3,000 36,000
Insurance 600 600 600 600 600 600 600 600 600 600 600 600 7,200
Interest 401 401 401 401 401 401 401 401 401 401 401 401 4,812
Inventory Purchases 17,088 15,624 15,648 17,040 18,288 15,624 15,648 17,040 18,288 15,624 15,648 17,040 198,600
Miscellaneous 9,044 8,312 8,324 9,020 9,644 8,312 8,324 9,020 9,644 8,312 8,324 9,020 105,300
Office 200 200 200 200 200 200 200 200 200 200 200 200 2,400
Payroll 44,583 44,583 44,583 44,583 44,583 44,583 44,583 44,583 44,583 44,583 44,583 44,583 534,996
Payroll Taxes 4,458 4,458 4,458 4,458 4,458 4,458 4,458 4,458 4,458 4,458 4,458 4,458 53,496
Professional Fees 0 0 0 0 0 0 0 0 0 0 0 0 0
Rent or Lease 2,100 2,100 2,100 2,100 2,100 2,100 2,100 2,100 2,100 2,100 2,100 2,100 25,200
Subscriptions & Dues 50 50 50 50 50 50 50 50 50 50 50 50 600
Supplies 400 400 400 400 400 400 400 400 400 400 400 400 4,800
Taxes & Licenses 100 100 100 100 100 100 100 100 100 100 100 100 1,200
Utilities & Telephone 900 900 900 900 900 900 900 900 900 900 900 900 10,800
Other: 0
Travel 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 500 500 500 200 9,700
Maintenance 200 200 200 200 200 200 200 200 200 200 200 200 2,400
0
Subtotal $93,324 $91,128 $91,564 $95,752 $95,524 $91,528 $91,164 $92,652 $94,024 $91,028 $92,164 $95,252 $1,115,104
Other Cash Out Flows:
Capital Purchases 0
Loan Principal 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 2,778 33,336
Owner's Draw 0
Other: 0
0
Subtotal $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $2,778 $33,336
Total Cash Outflows $96,102 $93,906 $94,342 $98,530 $98,302 $94,306 $93,942 $95,430 $96,802 $93,806 $94,942 $98,030 $1,148,440
Ending Cash Balance $32,058 $60,937 $89,066 $123,789 $168,670 $210,320 $247,321 $269,258 $280,168 $284,334 $271,759 $367,854

Note 1. Breakaway hopes to secure a $100,000 to purchase and install three new workstations in year 1 to handle the expected increase in bicycle orders.
The additional $40,000 would provide working capital during the expansion period. The loan will be paid back over three years at a 9% interest rate.