Depreciation Estimation

I will use the modified accelerated cost recovery system method of depreciation. According to my opinion it is the best for me because it will allow getting some tax savings because of the decrease of income due to accelerated depreciation.

All assets	Fixed assets	Intangible assets
Depreciation	Depreciation	Depreciation
2003	2004	2005	2003	2004	2005	2003	2004	2005
33%	45%	15%	33%	45%	15%	33%	45%	15%
	33%	45%		33%	45%		33%	45%
		33%			33%			33%
Accumulated depreciation	Accumulated depreciation	Accumulated depreciation
$694	$1 674	$2 073	$420	$1 014	$1 255	$274	$660	$818

Fixed Capital Estimation

I made the estimation for the first year. As all assets are almost the same in each consulting service than I determined the price for the next period by making inflation adjustments.

Name of assets	Costs
	Pessimistic	Realistic	Optimistic	Most probably
a computer	$550,00	$500,00	$450,00	$500,00
a monitor	$275,00	$250,00	$225,00	$250,00
a modem	$96,00	$80,00	$66,06	$80,34
a printer	$180,00	$150,00	$135,00	$152,50
the database	$1 040,00	$650,00	$325,00	$660,83
Other software	$400,00	$150,00	$10,00	$168,33
office equipment	$220,00	$200,00	$180,00	$200,00
a telephone/fax	$100,00	$90,00	$80,00	$90,00
Total:	$2 861,00	$2 070,00	$1 471,06	$2 102,01

Working Capital Estimation

I also made the estimation for the first year, as with the fixed capital, and than determined the price for the next period by making inflation adjustments.

Name of assets	Costs

	Pessimistic	Realistic	Optimistic

Paper	$36,00	$24,00	$13,00

Cartridges	$27,50	$25,00	$22,50

Writing implements	$15,00	$12,71	$7,14

Total:	$78,50	$65,71	$42,64

Basing on the cash receipt forecast, I will need 1*$78,50+4*$62,71+1*$42,64= $62 a year for working capital.

Marketing Estimation

The sales estimation I based on the next assumptions:

1. The share of the ''Irkutskiy'' market will decrease, as there will appear some competitors.

2003	2004	2005
45%	43%	41%

The amount of purchases a day in average in the "Irkutskiy" market:

in items

2003	2004	2005

2. The share of the the ''Fortuna'' martet will decrease as there will appear some competitors.

2004	2005
12%	10%

The amount of purchases a day in average in the "Fortuna" market:

in items

2004	2005

3. The share of the ''Complex'' market will stay constant.

2005

19%

The amount of purchases a day in average in the "Complex" market:

in items

2005

The assumed amount of potential clients that will use my database:

1 year	2 year	3 year
50%	70%	85%

The amount of potential clients a day

2003	2004	2005

The amount of potential clients a year:

2003	2004	2005

The projected sales price

2003	2004	2005
$0,80	$0,84	$0,88

Advertisement expenses

	2003	2004	2005
Printed materials	$347	$303	$265
News papers	$312	$328	$344
Total:	$659	$631	$609

Labor Expenses

Labor expenses are based on assumption that every year I will open one additional consulting center. So, there should be one additional consultant each year.

A month:

	2003	2004	2005
Salary	$200	$210	$221

A year:

	2003	2004	2005
Salary	$2 400	$5 040	$15 876

Rent Expense Estimation

Rent, a year

	2003	2004	2005
``Irkutskiy`` market	$1 600,00	$1 680,00	$1 764,00
``Fortuma`` market		$1 800,00	$1 890,00
``Complex`` market			$3 200,00
Total	$1 600,00	$3 480,00	$6 854,00

MANAGEMENT PLAN

As I plan to organize small venture, I decided to use simple structure for management.

The responsibility of manager: develop database, programming, accounting, transport, managing finance, human resource, and operational activities.

The responsibility of consultants:serve clients and update database, look after equipment

This structure and distribution of functions are optimal for such businesses as I plan to organize.

Date: 2015-12-24; view: 814

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