March 2002

This sample business plan has been made available to users of Business Plan Pro, business planning software published by Palo Alto Software. Names, locations and numbers may have been changed, and substantial portions of text may have been omitted from the original plan to preserve confidentiality and proprietary information. You are welcome to use this plan as a starting point to create your own, but you do not have permission to reproduce, publish, distribute or even copy this plan as it exists here. Requests for reprints, academic use, and other dissemination of this sample plan should be emailed to the marketing department of Palo Alto Software at marketing@paloalto.com. For product information visit our Website: www.paloalto.com or call: 1-800-229-7526.

Copyright Palo Alto Software, Inc., 1995-2002

Confidentiality Agreement

The undersigned reader acknowledges that the information provided by _________________________ in this business plan is confidential; therefore, reader agrees not to disclose it without the express written permission of _________________________. It is acknowledged by reader that information to be furnished in this business plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to _________________________. Upon request, this document is to be immediately returned to _________________________. ___________________ Signature ___________________ Name (typed or printed) ___________________ Date This is a business plan. It does not imply an offering of securities.

Table of Contents1.0 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.1Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.2Mission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Company Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 2.1Company Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 2.2Start-up Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Market Analysis Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 4.1Market Segmentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 4.2Competitive Edge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Strategy and Implementation Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 5.1Sales Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 5.1.1 Sales Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Management Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 6.1Personnel Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Financial Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1Important Assumptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2Break-even Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.3Projected Profit and Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4Projected Cash Flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.5Projected Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6Business Ratios . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 9 10 11 12 14 14

2.0

3.0 4.0

5.0

6.0

7.0

Hamlin and Park Design1.0 Executive SummaryThe city of Claremont has been growing by 6% annually for the past five years. Currently, the city's population is 700,000. Most importantly, the greatest population increase is in southwest Claremont which is the city's most affluent area. The population of southwest Claremont has grown by 20% the past two years. The 80,000 residents of the area have an average income of $200,000 and the average home is valued at $350,000. The new construction in southwest section of the city is valued at 600 million dollars in home sales next year alone. Growth in the area has also generated increase remodeling of existing homes. Last year, remodeling projects were up 20% over the previous year and accounted for $20 million paid for remodeling services in the area. The building and remodeling in southwest Claremont has increased the demand for interior design services. Last year, residential interior design companies generated $4 million in sales in the greater Claremont area. Forecasts for next year predict that there will be an increase of 11% in sales. Hamlin and Park Design will offers a wide range of interior design services to meet any client's needs in southwest Claremont: On-site consultations; Project survey & analysis; Space planning & furniture arrangement; Design concepts; Finishes & furnishings; Custom designs; Purchasing, delivery, & installation; Project coordination & management.

Courtney Hamlin and Katherine Park have ten years of experience with the city's top interior designs firms. Both have been successful is creating a base of former clients that will refer new business to the designers.

1.1 ObjectivesHamlin and Park Design offers a wide range of interior design services to meet any client's needs in southwest Claremont. The primary objectives of our firm are to: Exceed customers' expectations for service and product. Increase the number of clients served by 15% per year through superior performance. Develop a sustainable start-up business that is profitable.

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Hamlin and Park Design1.2 MissionHamlin and Park Design's mission is to assure superior customer service by doing the following: Open communication with clients. The explanation of the "pros and cons" of different selections and design options are discussed in detail. Include the client in every stage of the design process. Exceed the customer's expectations for the project. Maintain continuing education of the latest development and innovations in the interior design field.

Highlights (Planned)

$300,000 $250,000 $200,000

Sales$150,000 $100,000 $50,000 $0 2003 2004 2005

Gross Margin Net Profit

2.0 Company SummaryCourtney Hamlin and Katherine Park will start Hamlin and Parks Design to offer a wide range of interior design services to clients in southwest Claremont. The company has a high level of expertise in interior design and will provide superior personal services to all clients. Courtney and Katherine take pride in knowing that 50% of their business comes from repeat clients and their referrals. Our responsibility as interior design professionals is to take the client's design goals and utilize our skills and resources to exceed the client's expectations for service, value, functionality, and beauty.

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Hamlin and Park Design2.1 Company OwnershipThe owners and designers of Hamlin and Park Design are Courtney Hamlin and Katherine Park.

2.2 Start-up SummaryCourtney Hamlin and Katherine Park will invest $60,000 in Hamlin and Park Design. They will also secure a $50,000 loan. The following table and chart show projected initial start-up costs for Hamlin and Park Design.

Table: Start-up Start-up Requirements Start-up Expenses Legal Stationery etc. Brochures Insurance Rent Answering Service Utilities Start Up Office Furnishings Expensed Equipment Business Software Office Supplies Total Start-up Expense

$900 $2,000 $4,000 $200 $3,000 $200 $250 $4,000 $3,000 $2,000 $1,000 $20,550

Start-up Assets Needed Cash Balance on Starting Date Other Short-term Assets Total Short-term Assets Long-term Assets Total Assets Total Requirements Funding Investment Investor 1 Investor 2 Total Investment Short-term Liabilities Accounts Payable Current Borrowing Other Short-term Liabilities Subtotal Short-term Liabilities Long-term Liabilities Total Liabilities Loss at Start-up Total Capital Total Capital and Liabilities

$59,450 $20,000 $79,450 $0 $79,450 $100,000

$30,000 $30,000 $60,000

$10,000 $0 $0 $10,000 $30,000 $40,000 ($20,550) $39,450 $79,450

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Hamlin and Park Design

Start-up

$80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Expenses Assets Investment Loans

3.0 ServicesHamlin and Park Design will offers a wide range of interior design services to meet any client's needs in southwest Claremont: On-site Consultations: Convenient consultations for busy homeowners and professionals are offered at the home or office. The consultation will include all necessary product samples for clients for review, thus eliminating the hassle of having to visit numerous stores for different products. Project Survey & Analysis: Each site is inspected for its layout and function. Indepth client interviews are conducted to determine all necessary requirements for the project. This information is then analyzed for design concepts and space planning. Design Concepts: The design concept can begin with a treasured piece of fabric or furniture, or simply a blank page. The goal is to attain the "look" and "feel" a client wants, from "light and airy" to "rich and elegant" to "comfortable and cozy." Each project develops its own flavor from the unique selection of fabrics, furniture, and finishes. Finishes & Furnishings: There are many factors to consider when selecting furniture and finishes. Hamlin and Park Design's expertise and guidance helps clients make the best selections for their needs. Creativity is also applied in the selection process to create the desired look. Custom Designs: Custom furniture, built-ins, and window treatments are also available through the talents of Hamlin and Park Design. Detailed drawings are prepared to help clients visualize the finished piece. Purchasing, Delivery, & Installation: Once final selections are made, Hamlin and Park Design assumes all responsibility for coordinating the purchasing, delivery and installation of the entire project. Page 4

Hamlin and Park Design Project Coordination & Management: Some projects require a certain sequence of installation for maximizing results. Hamlin and Park Design coordinates all aspects of these projects to ensure smooth transitions from each phase until project completion.

4.0 Market Analysis SummaryDue to the strengthening of the area's economy, more southwest Claremont homeowners are exploring interior design to improve their homes' beauty and charm. Last year, residential interior design companies generated $4 million in sales in the greater Claremont area. Approximately, 75% of the sales were located in southwest Claremont. Forecasts for next year predict that there will be an increase of 11% in sales. This demand for interior design services is a tremendous opportunity. Hamlin and Park Design is poised to take advantage of these changes, and expects to become a recognized name and profitable entity in the city's interior design market.

4.1 Market SegmentationThe customers that Hamlin and Park Design will be serving can be divided into three groups: New Home Construction: Hamlin and Park Design will compete for the interior design projects associated with new homes. Contracted consulting responsibilities with the builders can include one or more of the companies services, i.e. strategic planning, master planning, and lighting, floor or carpet design. Remodeling Projects: These projects have some of the same characteristics as new home construction (i.e. working as a consultant with builders) but can also include greater control over all aspect of the project. Interior Design of Existing Home: Hamlin and Park Design will control all aspects of these projects.

Table: Market Analysis Market Analysis Potential Customers New Home Construction Remodeling Projects Interior Design of Existing Home Total

Growth 6% 10% 8% 8.50%

2002 1,500 3,000 2,000 6,500

2003 1,590 3,300 2,160 7,050

2004 1,685 3,630 2,333 7,648

2005 1,786 3,993 2,520 8,299

2006 1,893 4,392 2,722 9,007

CAGR 5.99% 10.00% 8.01% 8.50%

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Hamlin and Park Design

Market Analysis (Pie)

New Home Construction Remodeling Projects Interior Design of Existing Home

4.2 Competitive EdgeHamlin and Park Design's competitive edge is that both Courtney Hamlin and Katherine Park are highly successful interior designers with a loyal customer base. Courtney has been a Project Manager with Sullivan and Associates for five years. During that time she has established strong relationships with builders and vendors which will prove beneficial in the coming years. For the past six years, Katherine has worked as a Design Consultant for Jonathan Miller, the most successful interior designer in Claremont. Together, Courtney and Katherine have the skills, resources and experience to be build on the base of 1,000 satisfied customers.

5.0 Strategy and Implementation SummaryHamlin and Park will focus on the interior design needs in the southwest section of the city. Our target customers will be the affluent residents of southwest Claremont.

5.1 Sales StrategyThe following is the sales strategy Hamlin and Park Design will employ on the three target customer groups: New Home Construction/Remodeling Projects: Courtney Hamlin already has a strong professional relationship with the dominant builders/remodelers in southwest Claremont. She will meet with them directly and pitch the consulting services of Hamlin and Park Design. Interior Design of Existing Home: Visibility with the customer base is the most Page 6

Hamlin and Park Designimportant marketing activity Hamlin and Park Design will follow. Southwest Claremont has five homeowner associations that meet regularly. In the past both Courtney and Katherine have made presentations on interior design issues. They will continue this service to the community to raise the visibility of Hamlin and Park Design.

5.1.1 Sales ForecastThe following table and chart will forecast sales for the next three years.

Table: Sales Forecast (Planned) Sales Forecast Sales Remodeling Projects New Home Construction Interior Design of Existing Home Total Sales Direct Cost of Sales Remodeling Projects New Home Construction Interior Design of Existing Home Subtotal Direct Cost of Sales

2003 $87,672 $41,000 $90,739 $219,411 2003 $8,634 $5,500 $9,091 $23,225

2004 $96,685 $45,280 $97,800 $239,765 2004 $9,500 $6,300 $10,000 $25,800

2005 $108,200 $47,300 $105,000 $260,500 2005 $10,000 $7,000 $10,000 $27,000

Sales Monthly (Planned)

$45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0

Remodeling Projects New Home Construction Interior Design of Existing Home

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Hamlin and Park Design

Sales by Year (Planned)

$300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0 2003 2004 2005

Remodeling Projects New Home Construction Interior Design of Existing Home

6.0 Management SummaryHamlin and Park is a two member interior design firm. Both designers are equal partners in the firm. Courtney Hamlin began her passion for the arts at a young age. Upon graduating from State University, Courtney secured an office management position at a local commercial and residential interior design firm. This position afforded her the learning experience of overseeing all aspects of design projects; from preparing proposals, to scheduling and coordinating all phases of a project. After five years of managing the design firm, Courtney returned to school for an Associates Degree in Interior Design. After completing her Interior Design degree, Courtney became a designer and project manager for Sullivan and Associates. Katherine Park received a B.A. in Art from State University. She continued her education at the Art Institute of Monroe and obtained a degree in Interior Design. She has worked as a Design Consultant for Jonathan Miller, the most successful interior designer in Claremont.

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Hamlin and Park Design6.1 Personnel PlanThe staff of Hamlin and Park Design will be its co-owners Courtney Hamlin and Katherine Park.

Table: Personnel (Planned) Personnel Plan Courtney Hamlin Katherine Park Total Payroll Total People Payroll Burden Total Payroll Expenditures 2003 $48,000 $48,000 $96,000 2 $14,400 $110,400 2004 $54,000 $54,000 $108,000 2 $16,200 $124,200 2005 $60,000 $60,000 $120,000 2 $18,000 $138,000

7.0 Financial PlanThe following is the financial plan for Hamlin and Park Design.

7.1 Important AssumptionsThe financial plan depends on important assumptions, most of which are shown in the following table as annual assumptions. The monthly assumptions are included in the appendices. From the beginning, we recognize that collection days are critical, but not a factor we can influence easily. At least we are planning on the problem, and dealing with it. Interest rates, tax rates, and personnel burden are based on conservative assumptions. Some of the more important underlying assumptions are: We assume a strong economy, without major recession. We assume, of course, that there are no unforeseen changes in the economy that would change our estimations.

Table: General Assumptions General Assumptions Short-term Interest Rate % Long-term Interest Rate % Tax Rate % Expenses in Cash % Sales on Credit % Personnel Burden % 2003 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% 2004 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% 2005 10.00% 10.00% 30.00% 10.00% 50.00% 15.00%

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Hamlin and Park Design7.2 Break-even AnalysisThe following table and chart will summarize our break-even analysis. The monthly break-even point is $14,778.

Table: Break-even Analysis Break-even Analysis: Monthly Units Break-even Monthly Sales Break-even Assumptions: Average Per-Unit Revenue Average Per-Unit Variable Cost Estimated Monthly Fixed Cost

15 $14,778

$1,000.0 0 $100.00 $13,300

Break-even Analysis$10,000 $5,000 $0 ($5,000) ($10,000) ($15,000) $0 $4,000 $8,000 $12,000 $16,000 $20,000

Monthly break-even pointBreak-even point = where line intersects with 0

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Hamlin and Park Design7.3 Projected Profit and LossOur projected profit and loss is shown on the following table and charts.

Table: Profit and Loss (Planned) Pro Forma Profit and Loss Sales Direct Cost of Sales Other Production Expenses Total Cost of Sales Gross Margin Gross Margin % Operating Expenses: Advertising/Promotion Travel Miscellaneous Payroll Expense Payroll Burden Depreciation Leased Equipment Utilities Insurance Rent Contract/Consultants 2003 $219,411 $23,225 $0 -----------$23,225 $196,186 89.41% 2004 $239,765 $25,800 $0 -----------$25,800 $213,965 89.24% 2005 $260,500 $27,000 $0 -----------$27,000 $233,500 89.64%

Total Operating Expenses Profit Before Interest and Taxes Interest Expense Short-term Interest Expense Long-term Taxes Incurred Extraordinary Items Net Profit Net Profit/Sales

$6,000 $0 $0 $96,000 $14,400 $0 $2,400 $2,400 $2,400 $36,000 $0 -----------$159,600 $36,586 $0 $2,643 $10,183 $0 $23,760 10.83%

$7,000 $0 $0 $108,000 $16,200 $0 $2,400 $2,400 $2,400 $36,000 $0 -----------$174,400 $39,565 $0 $2,010 $11,267 $0 $26,289 10.96%

$10,000 $0 $0 $120,000 $18,000 $0 $2,400 $2,400 $2,400 $36,000 $0 -----------$191,200 $42,300 $0 $1,350 $12,285 $0 $28,665 11.00%

Profit Monthly (Planned)$20,000

$15,000

$10,000

$5,000

$0

($5,000)

($10,000) Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

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Hamlin and Park Design

Profit Yearly (Planned)

$30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 2003 2004 2005

7.4 Projected Cash FlowCash flow projections are critical to our success. The monthly cash flow is shown in the illustration, with one bar representing the cash flow per month, and the other the monthly balance. The annual cash flow figures are included here and the more important detailed monthly numbers are included in the appendices.

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Hamlin and Park DesignTable: Cash Flow (Planned) Pro Forma Cash Flow Cash Received Cash from Operations: Cash Sales From Receivables Subtotal Cash from Operations Additional Cash Received Extraordinary Items Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of other Short-term Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received 2003 2004 2005

$109,706 $106,102 $215,808

$119,883 $119,548 $239,431

$130,250 $129,909 $260,159

$0 $0 $0 $0 $0 $0 $0 $0 $215,808

$0 $0 $0 $0 $0 $0 $0 $0 $239,431

$0 $0 $0 $0 $0 $0 $0 $0 $260,159

Expenditures Expenditures from Operations: Cash Spent on Costs and Expenses Wages, Salaries, Payroll Taxes, etc. Payment of Accounts Payable Subtotal Spent on Operations Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Principal Repayment of Current Borrowing Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Short-term Assets Purchase Long-term Assets Dividends Adjustment for Assets Purchased on Credit Subtotal Cash Spent

2003 $8,525 $110,400 $84,073 $202,998

2004 $8,928 $124,200 $80,224 $213,351

2005 $9,384 $138,000 $84,310 $231,693

$0 $0 $0 $6,600 $0 $0 $0 $0 $209,598

$0 $0 $0 $6,600 $0 $0 $0 $0 $219,951

$0 $0 $0 $6,600 $0 $0 $0 $0 $238,293

Net Cash Flow Cash Balance

$6,209 $65,659

$19,479 $85,139

$21,866 $107,005

Cash (Planned)$80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 ($10,000) ($20,000) Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

Net Cash Flow Cash Balance

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Hamlin and Park Design7.5 Projected Balance SheetThe balance sheet in the following table shows managed but sufficient growth of net worth, and a sufficiently healthy financial position. The monthly estimates are included in the appendices.

Table: Balance Sheet (Planned) Pro Forma Balance Sheet Assets Short-term Assets Cash Accounts Receivable Other Short-term Assets Total Short-term Assets Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets Total Assets

2003 $65,659 $3,603 $20,000 $89,263 $0 $0 $0 $89,263

2004 $85,139 $3,938 $20,000 $109,076 $0 $0 $0 $109,076

2005 $107,005 $4,278 $20,000 $131,283 $0 $0 $0 $131,283

Liabilities and Capital Accounts Payable Current Borrowing Other Short-term Liabilities Subtotal Short-term Liabilities Long-term Liabilities Total Liabilities Paid-in Capital Retained Earnings Earnings Total Capital Total Liabilities and Capital Net Worth 2003 $2,652 $0 $0 $2,652 $23,400 $26,052 $60,000 ($20,550) $23,760 $63,210 $89,263 $63,210 2004 $2,778 $0 $0 $2,778 $16,800 $19,578 $60,000 $3,210 $26,289 $89,499 $109,076 $89,499 2005 $2,919 $0 $0 $2,919 $10,200 $13,119 $60,000 $29,499 $28,665 $118,164 $131,283 $118,164

7.6 Business RatiosThe following table provides important ratios for the real estate industry, as determined by the Standard Industry Classification (SIC) Index, 8999, Services.

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Hamlin and Park DesignTable: Ratios (Planned) Ratio Analysis Sales Growth Percent of Total Assets Accounts Receivable Inventory Other Short-term Assets Total Short-term Assets Long-term Assets Total Assets Other Short-term Liabilities Subtotal Short-term Liabilities Long-term Liabilities Total Liabilities Net Worth Percent of Sales Sales Gross Margin Selling, General & Administrative Expenses Advertising Expenses Profit Before Interest and Taxes Main Ratios Current Quick Total Debt to Total Assets Pre-tax Return on Net Worth Pre-tax Return on Assets Business Vitality Profile Sales per Employee Survival Rate Additional Ratios Net Profit Margin Return on Equity Activity Ratios Accounts Receivable Turnover Collection Days Inventory Turnover Accounts Payable Turnover Total Asset Turnover Debt Ratios Debt to Net Worth Short-term Liab. to Liab. Liquidity Ratios Net Working Capital Interest Coverage Additional Ratios Assets to Sales Current Debt/Total Assets Acid Test Sales/Net Worth Dividend Payout 2002 0.00% 2003 9.28% 2004 8.65% Industry Profile 8.50%

4.04% 0.00% 22.41% 100.00% 0.00% 100.00% 0.00% 2.97% 26.21% 29.19% 70.81%

3.61% 0.00% 18.34% 100.00% 0.00% 100.00% 0.00% 2.55% 15.40% 17.95% 82.05%

3.26% 0.00% 15.23% 100.00% 0.00% 100.00% 0.00% 2.22% 7.77% 9.99% 90.01%

20.90% 5.00% 55.70% 81.60% 18.40% 100.00% 48.20% 36.90% 15.50% 52.40% 47.60%

100.00% 89.41% 78.59% 2.73% 16.67%

100.00% 89.24% 78.28% 2.92% 16.50%

100.00% 89.64% 78.63% 3.84% 16.24%

100.00% 0.00% 82.60% 0.60% 1.50%

33.66 33.66 29.19% 62.06% 43.95% 2002 $109,706

39.27 39.27 17.95% 46.45% 38.12% 2003 $119,883

44.97 44.97 9.99% 36.94% 33.25% 2004 $130,250

1.57 1.13 63.70% 1.90% 5.20% Industry $0 0.00%

2002 10.83% 37.59%

2003 10.96% 29.37%

2004 11.00% 24.26%

n.a n.a

30.45 6 0.00 28.93 2.46

30.45 11 0.00 28.93 2.20

30.45 12 0.00 28.93 1.98

n.a n.a n.a n.a n.a

0.41 0.10

0.22 0.14

0.11 0.22

n.a n.a

$86,610 13.85

$106,299 19.68

$128,364 31.33

n.a n.a

0.41 3% 32.30 3.47 $0

0.45 3% 37.85 2.68 0.00

0.50 2% 43.50 2.20 0.00

n.a n.a n.a n.a n.a

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AppendixAppendix Table: Sales Forecast (Planned) Sales Forecast Sales Remodeling Projects New Home Construction Interior Design of Existing Home Total Sales Direct Cost of Sales Remodeling Projects New Home Construction Interior Design of Existing Home Subtotal Direct Cost of Sales

Mar $2,100 $0 $3,000 $5,100 Mar $0 $0 $0 $0

Apr $2,200 $0 $3,000 $5,200 Apr $230 $0 $320 $550

May $3,020 $2,000 $4,240 $9,260 May $433 $300 $590 $1,323

Jun $6,000 $3,000 $6,300 $15,300 Jun $630 $400 $800 $1,830

Jul $8,500 $4,000 $9,000 $21,500 Jul $950 $500 $1,002 $2,452

Aug $12,000 $5,000 $11,000 $28,000 Aug $1,201 $600 $1,202 $3,003

Sep $14,000 $7,000 $14,000 $35,000 Sep $1,550 $700 $1,409 $3,659

Oct $18,000 $8,000 $17,000 $43,000 Oct $1,700 $900 $1,650 $4,250

Nov $10,022 $5,000 $13,000 $28,022 Nov $850 $800 $1,200 $2,850

Dec $5,210 $3,000 $4,322 $12,532 Dec $530 $600 $390 $1,520

Jan $3,820 $2,000 $3,222 $9,042 Jan $300 $400 $280 $980

Feb $2,800 $2,000 $2,655 $7,455 Feb $260 $300 $248 $808

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AppendixAppendix Table: Personnel (Planned) Personnel Plan Courtney Hamlin Katherine Park Total Payroll Total People Payroll Burden Total Payroll Expenditures Mar $4,000 $4,000 $8,000 2 $1,200 $9,200 Apr $4,000 $4,000 $8,000 2 $1,200 $9,200 May $4,000 $4,000 $8,000 2 $1,200 $9,200 Jun $4,000 $4,000 $8,000 2 $1,200 $9,200 Jul $4,000 $4,000 $8,000 2 $1,200 $9,200 Aug $4,000 $4,000 $8,000 2 $1,200 $9,200 Sep $4,000 $4,000 $8,000 2 $1,200 $9,200 Oct $4,000 $4,000 $8,000 2 $1,200 $9,200 Nov $4,000 $4,000 $8,000 2 $1,200 $9,200 Dec $4,000 $4,000 $8,000 2 $1,200 $9,200 Jan $4,000 $4,000 $8,000 2 $1,200 $9,200 Feb $4,000 $4,000 $8,000 2 $1,200 $9,200

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AppendixAppendix Table: General Assumptions General Assumptions Short-term Interest Rate % Long-term Interest Rate % Tax Rate % Expenses in Cash % Sales on Credit % Personnel Burden % Mar 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Apr 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% May 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Jun 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Jul 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Aug 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Sep 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Oct 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Nov 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Dec 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Jan 10.00% 10.00% 30.00% 10.00% 50.00% 15.00% Feb 10.00% 10.00% 30.00% 10.00% 50.00% 15.00%

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AppendixAppendix Table: Profit and Loss (Planned) Pro Forma Profit and Loss Sales Direct Cost of Sales Other Production Expenses Total Cost of Sales Gross Margin Gross Margin % Operating Expenses: Advertising/Promotion Travel Miscellaneous Payroll Expense Payroll Burden Depreciation Leased Equipment Utilities Insurance Rent Contract/Consultants Mar $5,100 $0 $0 -----------$0 $5,100 100.00% Apr $5,200 $550 $0 -----------$550 $4,650 89.42% May $9,260 $1,323 $0 -----------$1,323 $7,937 85.71% Jun $15,300 $1,830 $0 -----------$1,830 $13,470 88.04% Jul $21,500 $2,452 $0 -----------$2,452 $19,048 88.60% Aug $28,000 $3,003 $0 -----------$3,003 $24,997 89.28% Sep $35,000 $3,659 $0 -----------$3,659 $31,341 89.55% Oct $43,000 $4,250 $0 -----------$4,250 $38,750 90.12% Nov $28,022 $2,850 $0 -----------$2,850 $25,172 89.83% Dec $12,532 $1,520 $0 -----------$1,520 $11,012 87.87% Jan $9,042 $980 $0 -----------$980 $8,062 89.16% Feb $7,455 $808 $0 -----------$808 $6,647 89.16%

Total Operating Expenses Profit Before Interest and Taxes Interest Expense Short-term Interest Expense Long-term Taxes Incurred Extraordinary Items Net Profit Net Profit/Sales

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 ($8,200) $0 $245 ($2,534) $0 ($5,912) -115.92%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 ($8,650) $0 $241 ($2,667) $0 ($6,224) -119.68%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 ($5,363) $0 $236 ($1,680) $0 ($3,919) -42.33%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 $170 $0 $232 ($19) $0 ($43) -0.28%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 $5,748 $0 $227 $1,656 $0 $3,865 17.98%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 $11,697 $0 $223 $3,442 $0 $8,032 28.69%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 $18,041 $0 $218 $5,347 $0 $12,476 35.65%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 $25,450 $0 $213 $7,571 $0 $17,666 41.08%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 $11,872 $0 $209 $3,499 $0 $8,164 29.14%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 ($2,288) $0 $204 ($748) $0 ($1,745) -13.92%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 ($5,238) $0 $200 ($1,631) $0 ($3,806) -42.10%

$500 $0 $0 $8,000 $1,200 $0 $200 $200 $200 $3,000 $0 -----------$13,300 ($6,653) $0 $195 ($2,054) $0 ($4,794) -64.30%

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AppendixAppendix Table: Cash Flow (Planned) Pro Forma Cash Flow Cash Received Cash from Operations: Cash Sales From Receivables Subtotal Cash from Operations Additional Cash Received Extraordinary Items Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of other Short-term Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

$2,550 $85 $2,635

$2,600 $2,552 $5,152

$4,630 $2,668 $7,298

$7,650 $4,731 $12,381

$10,750 $7,753 $18,503

$14,000 $10,858 $24,858

$17,500 $14,117 $31,617

$21,500 $17,633 $39,133

$14,011 $21,250 $35,261

$6,266 $13,753 $20,019

$4,521 $6,208 $10,729

$3,728 $4,495 $8,222

0.00%

$0 $0 $0 $0 $0 $0 $0 $0 $2,635

$0 $0 $0 $0 $0 $0 $0 $0 $5,152

$0 $0 $0 $0 $0 $0 $0 $0 $7,298

$0 $0 $0 $0 $0 $0 $0 $0 $12,381

$0 $0 $0 $0 $0 $0 $0 $0 $18,503

$0 $0 $0 $0 $0 $0 $0 $0 $24,858

$0 $0 $0 $0 $0 $0 $0 $0 $31,617

$0 $0 $0 $0 $0 $0 $0 $0 $39,133

$0 $0 $0 $0 $0 $0 $0 $0 $35,261

$0 $0 $0 $0 $0 $0 $0 $0 $20,019

$0 $0 $0 $0 $0 $0 $0 $0 $10,729

$0 $0 $0 $0 $0 $0 $0 $0 $8,222

Expenditures Expenditures from Operations: Cash Spent on Costs and Expenses Wages, Salaries, Payroll Taxes, etc. Payment of Accounts Payable Subtotal Spent on Operations Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Principal Repayment of Current Borrowing Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Short-term Assets Purchase Long-term Assets Dividends Adjustment for Assets Purchased on Credit Subtotal Cash Spent

Mar $181 $9,200 $10,054 $19,436

Apr $222 $9,200 $1,643 $11,065

May $398 $9,200 $2,054 $11,652

Jun $614 $9,200 $3,646 $13,461

Jul $844 $9,200 $5,598 $15,641

Aug $1,077 $9,200 $7,662 $17,939

Sep $1,332 $9,200 $9,768 $20,300

Oct $1,613 $9,200 $12,076 $22,889

Nov $1,066 $9,200 $14,357 $24,622

Dec $508 $9,200 $9,425 $19,132

Jan $365 $9,200 $4,526 $14,091

Feb $305 $9,200 $3,265 $12,770

$0 $0 $0 $550 $0 $0 $0 $0 $19,986

$0 $0 $0 $550 $0 $0 $0 $0 $11,615

$0 $0 $0 $550 $0 $0 $0 $0 $12,202

$0 $0 $0 $550 $0 $0 $0 $0 $14,011

$0 $0 $0 $550 $0 $0 $0 $0 $16,191

$0 $0 $0 $550 $0 $0 $0 $0 $18,489

$0 $0 $0 $550 $0 $0 $0 $0 $20,850

$0 $0 $0 $550 $0 $0 $0 $0 $23,439

$0 $0 $0 $550 $0 $0 $0 $0 $25,172

$0 $0 $0 $550 $0 $0 $0 $0 $19,682

$0 $0 $0 $550 $0 $0 $0 $0 $14,641

$0 $0 $0 $550 $0 $0 $0 $0 $13,320

Net Cash Flow Cash Balance

($17,351) $42,099

($6,464) $35,636

($4,904) $30,732

($1,630) $29,102

$2,312 $31,414

$6,370 $37,783

$10,767 $48,550

$15,694 $64,244

$10,089 $74,333

$337 $74,670

($3,912) $70,758

($5,098) $65,659

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AppendixAppendix Table: Balance Sheet (Planned) Pro Forma Balance Sheet Assets Short-term Assets Cash Accounts Receivable Other Short-term Assets Total Short-term Assets Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets Total Assets

Starting Balances $59,450 $0 $20,000 $79,450 $0 $0 $0 $79,450

Mar $42,099 $2,465 $20,000 $64,564 $0 $0 $0 $64,564

Apr $35,636 $2,513 $20,000 $58,149 $0 $0 $0 $58,149

May $30,732 $4,476 $20,000 $55,207 $0 $0 $0 $55,207

Jun $29,102 $7,395 $20,000 $56,497 $0 $0 $0 $56,497

Jul $31,414 $10,392 $20,000 $61,805 $0 $0 $0 $61,805

Aug $37,783 $13,533 $20,000 $71,317 $0 $0 $0 $71,317

Sep $48,550 $16,917 $20,000 $85,467 $0 $0 $0 $85,467

Oct $64,244 $20,783 $20,000 $105,027 $0 $0 $0 $105,027

Nov $74,333 $13,544 $20,000 $107,877 $0 $0 $0 $107,877

Dec $74,670 $6,057 $20,000 $100,727 $0 $0 $0 $100,727

Jan $70,758 $4,370 $20,000 $95,128 $0 $0 $0 $95,128

Feb $65,659 $3,603 $20,000 $89,263 $0 $0 $0 $89,263

Liabilities and Capital Accounts Payable Current Borrowing Other Short-term Liabilities Subtotal Short-term Liabilities Long-term Liabilities Total Liabilities Paid-in Capital Retained Earnings Earnings Total Capital Total Liabilities and Capital Net Worth $10,000 $0 $0 $10,000 $30,000 $40,000 $60,000 ($20,550) $0 $39,450 $79,450 $39,450 Mar $1,576 $0 $0 $1,576 $29,450 $31,026 $60,000 ($20,550) ($5,912) $33,538 $64,564 $33,538 Apr $1,935 $0 $0 $1,935 $28,900 $30,835 $60,000 ($20,550) ($12,135) $27,315 $58,149 $27,315 May $3,462 $0 $0 $3,462 $28,350 $31,812 $60,000 ($20,550) ($16,055) $23,395 $55,207 $23,395 Jun $5,345 $0 $0 $5,345 $27,800 $33,145 $60,000 ($20,550) ($16,098) $23,352 $56,497 $23,352 Jul $7,339 $0 $0 $7,339 $27,250 $34,589 $60,000 ($20,550) ($12,233) $27,217 $61,805 $27,217 Aug $9,368 $0 $0 $9,368 $26,700 $36,068 $60,000 ($20,550) ($4,201) $35,249 $71,317 $35,249 Sep $11,592 $0 $0 $11,592 $26,150 $37,742 $60,000 ($20,550) $8,275 $47,725 $85,467 $47,725 Oct $14,037 $0 $0 $14,037 $25,600 $39,637 $60,000 ($20,550) $25,941 $65,391 $105,027 $65,391 Nov $9,272 $0 $0 $9,272 $25,050 $34,322 $60,000 ($20,550) $34,105 $73,555 $107,877 $73,555 Dec $4,417 $0 $0 $4,417 $24,500 $28,917 $60,000 ($20,550) $32,360 $71,810 $100,727 $71,810 Jan $3,174 $0 $0 $3,174 $23,950 $27,124 $60,000 ($20,550) $28,554 $68,004 $95,128 $68,004 Feb $2,652 $0 $0 $2,652 $23,400 $26,052 $60,000 ($20,550) $23,760 $63,210 $89,263 $63,210

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