Kristin Raina Interior Designs has decided to request a bank loan to
expand her business and the lender has asked for a one-year projection
of revenue and expenses. In order to request the loan, you will need to
create a Pro Forma one year budgeted income statement broken down over
12 months. You will need to take a look at the actual ending financial
statements for February, March and April and use this data to help
create the forecast for the next fiscal year of business.
For this project, you can assume that the company is expanding the
business for any reason, however below are some possible options for
seeking out a loan. You can use one of these options or create a unique
creative alternative for expansion in building the one-year pro forma
budgeted income statement:
Option 1: Kristin has decided to do a build out of a leased location.
Option 2: Kristin has decided to purchase a physical location for her business.
Option 3: A combination of the above or any other
creatively unique expansion/company growth idea (consider a new product
or new product line for example).
Keep in mind the request should be financially manageable and make
sure to look ahead to next week’s module where this budget will be the
foundation for a presentation that uses financial ratios to demonstrate
why the amount of the loan is manageable and why it is a good investment
in light of the strengths and weakness of the company. Using financial
ratios will be critical in supporting your argument and be aware that
most bankers or lenders will not even consider a loan prospect without
addressing, for example, the impact of additional debt on your debt to
Note: Excel must be used for creating the budget and the
spreadsheet must include formulas for all mathematical calculations
including adding, subtracting and sums of columns or groups of cells.
i believe the files i upload will be the only ones you need please let me know if you need anything else