The objective of this project is to offer you the opportunity to apply the concepts that you have learned in your managerial accounting class. You will select a simple product/service and develop a brief feasibility analysis. The analysis at a minimum will include a costing analysis (ch 2-4), daily/weekly/monthly budgets for 1 year (ch 9-11), a break-even analysis (ch 5-6), and a ROI and Net Present Value calculation (ch 14).
You just inherited some money, $100,000 to be exact. Your great-great grandma willed this money to you, under one condition – in her lifetime she was a very successful entrepreneur – that you may only use the money to start your own small business. Also, the only money you can keep is the net profit you make from your venture. In other words you may not keep any of the initial $100,000 she willed to you. Rather, after a maximum of 3-5 years, you must donate the $100,000 to a charity of your choice.
Financial Analysis Project
- Title Page (cover sheet) and Table of Contents [5 points]
- Executive Summary (1 page summarizing your findings and highlights) [10 points]
- General Information [20 Points]
- Industry/Market Information (description)
- Customer Information (description of your target customer population)
- Competitor Information (description of your current and potential competitors)
- Product/Service Information (description of your service/product)
- Technical Analysis [50 Points]
- Cost Analysis (variable and fixed costs, per unit cost, based on your estimated production per month or year).
- Budgets (monthly budget for 1 year, then 2-4 yearly budgets)
- Break-Even Analysis (per ch 6)
- Financial Analysis (ROI/NPV) for 1-3 years (budgeted income statement and/or balance sheet) (per ch 14)
- Conclusion and Self-Reflection (1/2 to 1 pg, your thoughts on completing this project) [15 Points]