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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:
Share:
| 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: 1020
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| Necessary Financing | | | Exercise 3 Insert the following words in the gaps in the text below. |