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This document presents a 4-year financial projection for Product X, including projections for sales, expenses, operating income, taxes, and net income. It also analyzes the impact of changing assumptions for annual sales growth and price increases on the net income projections. Specifically, increasing the annual sales growth rate above 3.5% could potentially maintain a steady projected net income of $500,000 by year 8.

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37 views

Data Chart

This document presents a 4-year financial projection for Product X, including projections for sales, expenses, operating income, taxes, and net income. It also analyzes the impact of changing assumptions for annual sales growth and price increases on the net income projections. Specifically, increasing the annual sales growth rate above 3.5% could potentially maintain a steady projected net income of $500,000 by year 8.

Uploaded by

api-273351602
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Adaptive Solutions Online

Operating Income
Income Tax

Net Income

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Total Expenses

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Expenses
Advertisement
Maintenance
Rent
Salaries
Shipping
Supplies
Web Services

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Sales
Cost of Goods
Gross Margin

Ye
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Financial Projection for Product X


42,524,207
29,809,469
12,714,738

45,222,900
31,701,253
13,521,647

48,092,858
33,713,093
14,379,765

51,144,951
35,852,611
15,292,340

3,190,816
500,000
1,050,000
5,953,389
1,445,823
467,766
75,000
12,682,794

3,393,217
625,000
1,113,000
6,331,206
1,537,579
497,452
80,250
13,577,704

3,608,464
430,000
1,179,780
6,733,000
1,635,157
529,021
85,868
14,201,291

3,837,371
525,000
1,250,567
7,160,293
1,738,928
562,594
91,878
15,166,632

178,474
62,466
116,008

125,708
43,998
81,710

31,944
11,180
20,764

(56,057)
(56,057)

Assumptions
Units Sold in Prior Year
Unit Cost
Annual Sales Growth
Annual Price Increase
Margin

242,847
$122.75
3.50%
2.75%
29.90%

Part 3: Changing the values of the Annual Sales Growth and the Annual Price Increase would change the values of the net i
Case# (annual Sales growth,
Annual Price increase)
Case 1 (4.50%, 3.50%)
Case 2 (2.50%, 1.00%)
Case 3 (1.50%, 5.00%)

Net Income: Year Net Income: Year Net Income: Year Net Income: Year
1
2
3
4
20,764
(16,912)
157,890
149,091
20,764
(66,850)
52,180
(18,763)
20,764
(33,971)
78,643
90,095

If the net income of year 8 is 500,000, then the margin is about 30.36%.

3. You would keep inserting different percentage values of the Annual Sales Growth in order to keep a steady net income and

8
Ye
ar

7
Ye
ar

6
Ye
ar

5
Ye
ar

Ye
ar

9-Dec-14

54,390,737
38,127,907
16,262,830

57,842,510
40,547,599
17,294,910

61,513,340
43,120,851
18,392,489

65,417,130
45,857,408
19,559,722

4,080,805
550,000
1,325,601
7,614,703
1,849,285
598,298
98,310
16,117,002

4,339,688
450,000
1,405,137
8,097,951
1,966,645
636,268
105,191
17,000,881

4,615,000
400,000
1,489,445
8,611,868
2,091,454
676,647
112,555
17,996,968

4,907,785
400,000
1,578,812
9,158,398
2,224,182
719,588
120,434
19,109,199

145,828
51,040
94,788

294,030
102,910
191,119

395,520
138,432
257,088

450,523
157,683
292,840

d change the values of the net income.


Net Income: Year Net Income: Year Net Income: Year Net Income: Year
5
6
7
8
191,149
320,314
423,380
500,941
(45,804)
6,671
24,770
8,339
106,690
206,957
277,322
317,971

to keep a steady net income and value of 0 net income in year 2. possiblly by inputing increasing values above 3.50% to find accommoda

e 3.50% to find accommodates the needs.

Projected Net Income


Product X
6,000,000

5,000,000

NET INCOME

4,000,000

3,000,000

2,000,000

1,000,000

(1,000,000)

YEAR
Series1

Series2

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