Module 3d: Annual Forcasting Model

Session 3: Cost & Income Forecasting

3a. Revenue/ Expense Forecast 3b. Revenue/Expense Worksheet 3c. Forecasting Breakeven 3d. Annual Forcasting Model 3e. Uses and Sources of Funds

1. Self-Assessment
2. Business Idea
3. Cost & Income
4. Business Proposal
5. Monitor Progress
Graduation!

Module 3d: Annual Forcasting Model

In the preceding exercise, you listed your selling price, direct costs and overhead costs. Using that information, you can now develop your forecast for a 12 month period. Keeping in mind that the breakeven level is the point where you do not make a profit or have a loss, you can forecast your sales in units and know in advance whether you will have a profit or a loss. Also keep in mind that if your business is seasonal for any reason, your overhead costs will continue whether you do any business or not.

Instructions: The Annual Forcasting Model will give you an idea of where to start. The form will ask you to enter your data into certain cells of the spreadsheet and then do the math for you. You may find this easier and can use the spreadsheet to experiment with different combinations of costs and revenues to see how your business really performs, and where you are actually making any money for all your efforts.

Now you can take a look at what your goals are in units of time that allow you to monitor results and compare with the goals. Enter the Per Year amounts from your calculated spread sheet. The Per Month and Per Week columns will automatically calculate. Breaking your forecast down to the Per Week level allows you to see your target figures so that you can quickly tell where you are on target or off target. If you are off target, it will show you where you may need to take corrective action - and as quickly as possible.

If you've completed Step 3b: Revenue Expense Worksheet during this session, the following fields will automatically calculate using your input from 3b. If you've completed Step 3b at another time, you should have an email record of the results. Otherwise, please go to Step 3b.

Summary - Revenue Cost Forecast
	Per Year	Per Month	Per Week
Total Sales Revenue	$0.00	$0.00	$0.00
Total Variable Costs	$0.00	$0.00	$0.00
Total Gross Profit	$0.00	$0.00	$0.00
Total Overhead Costs	$0.00	$0.00	$0.00
Total Net Profit	$0.00	$0.00	$0.00

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