In the attached excel spreadsheet, you will find a cash flow statement for Year 1 for Cup o' Joe's Coffee.You've been brought on as a consultant to help with start-up.Based on this statement, what problem(s) will the owners face with cash flow?What do you suggest they do?

Pre-Startup Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jul-10 Aug-10 Oct-10 Total Item EST EST Cash on Hand (beginning of 10,000 -16,085 -28,872 -4,665 19,901 71,825 99,063 126,013 153,273 180,740 209,302 240,213 1,105,535 month CASH RECEIPTS Cash Sales 0 36,894 37,253 37,612 39,686 39,925 39,637 39,947 41,349 43,598 41,746 Loan/ other cash inj. 10,000 TOTAL CASH RECEIPTS 36,894 37,253 37,612 39,686 39,925 39,637 39,947 40, 155 41,349 43,598 41,746 437,802 Total Cash Available (before 20,000 8,022 32,588 57,513 84,512 111,750 138,700 165,960 193,428 222,089 252,900 281,959 cash out) CASH PAID OUT Appliances 7,981 3 Coffee 1,755 1,755 1,755 1,755 1,755 1,755 1,755 1,755 1,755 1,755 1,755 1,755 1,755 22,815 Cleaning Supplies 75 75 75 75 75 75 75 75 75 75 75 75 75 975 5 Gross wages (exact withdrawal) 0 5,502 5,502 5.502 5,502 5,502 5,502 5,502 5,502 5,502 5,502 5,502 5,502 66,024 Payroll expenses (taxes, etc.) 341 341 341 341 341 341 341 341 341 341 341 341 4,093 POS System 275 275 275 275 275 275 275 275 275 275 275 275 275 3,575 g Supplies (snacks, lids, cups, etc.) 1,390 1,390 1,390 1,390 1,390 1,390 1,390 1,390 1,39 1,390 1,390 1,390 18,070 Permits 1,000 1,000 Advertising 50 50 50 50 50 50 50 50 50 50 50 650 Decorations 259 100 0 0 0 0 0 0 100 0 0 459 0 0 0 0 0 0 0 0 0 Rent 0 0 0 0 Phone, Cable, Internet 34 34 34 34 34 34 34 34 34 34 34 34 34 442 Heat/AC 200 200 200 200 200 200 200 200 200 200 200 200 2,600 Insurance 110 110 110 110 110 110 110 10 1 10 110 110 110 110 1,430 Electricity 150 150 150 150 150 150 150 150 150 150 150 150 150 1,950 Interest 0 Other expenses (all others) 0 0 0 O 0 0 O O 0 O 0 0 O 0 0 0 0 0 Other (specify) 030 Other (specify) O O O O 0 O 0 O 0 31 Other (specify) 0 O O 0 O 0 O O O O O O 0 32 Misc. Renovations 20,000 0 0 0 0 0 0 0 20,000 33 SUBTOTAL 33,280 9,982 9,882 9.882 9,882 9,882 9,882 9,882 9,882 9,882 9,982 9,882 9,882 152,065 34 Loan principal payment.7y.8pc 2,805 2,805 2,805 2,805 2,805 2,805 2,805 2,805 2,805 2,805 2,805 2,805 2,805 36,465 35 Capital purchase (specify) 0 0 0 0 0 C 0 0 0 0 36 Other startup costs 0 O O O O 0 O O 0 37 Reserve and/or Escrow 0 O O O O O O 0 O O O 0 38 Owners' Withdrawal 0 0 0 0 0 0 0 0 0 0 0 0 0 0 39 TOTAL CASH PAID OUT 36,085 12,787 12,687 12,687 12,687 12,687 12,687 12,687 12,687 12,687 12,787 12,687 12,687 152,445 40 Cash Position (end of month) -16,085 -28,872 -4665 19901 44,826 71,825 99,063 126,013 153,273 180,740 209,302 240,213 269,272 285,357