My business is a steel company.

I've filled out the 2 worksheets can you please give an explanation of what was input and an insight of what my worksheets say. also please complete what the assigments indicates.

In this section, detail the expenses involved in opening for business and how much capital youll need. (Do not include ongoing expenses after your business opens; those are listed in the Financial Plan.) Estimating startup expenses as accurately as possible helps you gather enough startup capital.

Start-Up Expenses

Download and complete the Start-up Expenses template Start-Up-Expenses.xlsx Download Start-Up-Expenses.xlsx. In working on this Business Plan, you should already have gathered most, if not all, of the information you need. In the body of this section, be sure to explain all of the assumptions behind the figures. How did you come up with these expenses? If youve secured or expect to secure loans, explain the source/s, amount/s and terms. If youve secured or expect to secure investors, explain how much each investor will contribute and what percentage of ownership each receives in return.

Be sure to include extra capital for unexpected expenses. Opening a new business almost always ends up costing more than expected, and you need to be prepared. List this figure in the Start-Up Expenses template under Reserve for Contingencies. How much should you set aside for contingencies? You can talk to other business owners in your industry to get a ballpark figure. If you cant come up with a figure this way, a good rule of thumb is to set aside 20% to 25% of your total startup costs for contingencies.

Opening Day Balance Sheet

Download and complete the Opening Day Balance Sheet Opening-Day-Balance-Sheet.xlsx Download Opening-Day-Balance-Sheet.xlsx. Use it to detail the expected state of your business finances on opening day. As with the Start-Up Expenses sheet, be sure to explain the assumptions behind the figures.

Personal Financial Statement

If you are using the business plan to seek financing, include personal financial statements for each owner and each major stockholder. The personal financial statements should detail each persons assets and liabilities outside of the business and their personal net worth. Investors and/or lenders typically expect business owners to use personal assets to finance a startup, and theyll want to see how much capital you have available from your personal finances.

After reading the Startup Expenses & Capitalization section, I should know how much money is needed to start the business and how well capitalized you are.

Startup Expenses Lopez Steel Company LLC Nearly everyone who has ever started a business has underestimated the costs, and then faced the danger of running with inadequate capital reserves. The key to avoiding this pitfall is to adopt a rigorous approach to your research and planning The Startup Expenses worksheet will lead you through the process. EXPENSES - Begin by estimating expenses. What will it cost you to get your business up and running? The key to accuracy here is attention to detail. For each category of expense, draw up a list of everything you will need to purchase. This will include both tangible assets (for example, equipment, imventory) and services (for example, remodeling, insurance). Then determine where you might purchase these goods or services. Research more than one vendor, Le.: comparison shop. Do not look at price alone; terms of payment, delivery, reliability, and service are also important. CONTINGENCIES - Add a reserve for contingencies. Be sure to explain in your narrative how you decided on the amount you are putting into this reserve. WORKING CAPITAL - You cannot open with an empty bank account, You need a cash cushion to meet expenses while the business gets going. Eventually you should do a 12 -month cash flow projection. This is where you will work out your estimate of working capital needs. For now, either leave this line blank or put in your best rough guess. After you have done your cash flow, you can come back and enter the carefully researched figure. SOURCES - Now that you have estimated how much capital will be needed to start, you should turn your attention to the top part of this worksheet. Enter the amounts you will put in yourself, how much will be injected by partners or investors, and how much will be supplied by borrowing. COLLATERAL - If you will be using this plan to support a bank loan request, use the section near the bottom to show what assets are offered as collateral to secure the loan, and give your estimate of the value of these items. Be prepared to offer some proof of your estimates of collateral values. Location and Admin Expenses \begin{tabular}{lrr} \hline Rent & Related Costs & $ & 2,000 \\ Utility deposits & 300 \\ Legal and accounting fees & 1,000 \\ \hline Prepaid insurance & 5,000 \\ \hline Pre-opening salaries & 2,000 \\ Other & \\ Total Location and Admin Expenses & $ & 10,300 \\ \cline { 2 - 2 } \end{tabular} Opening Inventory \begin{tabular}{lrr} punch in computors & $ & 1,000 \\ face shields & & 100 \\ steel materials & & 2,000 \\ PPE & & 2,000 \\ Category 5 & & \\ \cline { 2 - 3 } Total Inventory & $ & 5,100 \\ \cline { 2 - 3 } \end{tabular} Advertising and Promotional Expenses \begin{tabular}{lrr} \hline Advertising & & 50 \\ Signage & & 200 \\ Printing & & 50 \\ Travelventertainment & & 100 \\ Otherladditional categories & & 200 \\ \cline { 2 - 4 } Total AdvertisinglPromotional Expenses & $ & 600 \\ \cline { 3 - 4 } & & \end{tabular} Other Expenses Other expense 1 if needed Other expense 2 if needed Total Other Expenses Reserve for Contingencies \begin{tabular}{rr} $ & 500 \\ & 500 \\ \hline$ & 1,000 \\ \hline$ & 40,000 \end{tabular} Working Capital $150,000 Summary Statement Sources of Capital \begin{tabular}{llr} \hline Owners' and other investments & $ & 525,000 \\ Bank loans & & 400,000 \\ Other loans & & \\ \cline { 2 - 3 } Total Source of Funds & $925,000 \\ \cline { 2 - 3 } \end{tabular} Startup Expenses Buildings/real estate Leasehold improvements Capital equipment Location/administration expenses Opening inventory Advertising/promotional expenses 0 Other expenses 1 Contingency fund 2 Working capital Total Startup Expenses 1 Loan Guarantors (other than owners) 2 Loan guarantor 1 3 Loan guarantor 2 4 Loan guarantor 3 A balance sheet shows the financial position of your company at a single moment in time; in this case, it will be as of opening day. Use your Startup Expenses spreadsheet to get the basic data for the balance sheet. Here are some accounting rules which will help you construct an accurate balance sheet: Assets are recorded at the lower of cost or current market value. Since your assets will be newly acquired, put them down at cost. If you have donated personal possessions to the business (e.g., a vehicle), enter them at market value. Prepaid Expenses are items like insurance premiums which you have already paid but have not yet "used". Other Assets are intangible items like patents and trademarks which are presumed to have economic value. It is very unlikely that you will have significant Other Assets as a new business. You should also include here items like lease and utility deposits. Current Liabilities are any debts due within twelve months. Trade payables and bank lines of credit are current liabilities. If you have a Long Term (multi year) Debt, then that portion of it which is payable over the next twelve months goes in "Current Portion of Long Term Debt". The remaining portion of that debt then goes in the "Bank Loans Payable (greater than 12 months)" section under Long Term Debt. Owners' Equity is what is left when you subtract Liabilities from Assets. It will be less than you have actually spent on starting your business. That is because many of your pre-opening expenses do not result in ownership of assets which show on a balance sheet. For example, advertising, travel, and legal fees may be necessary, but they do not generate balance sheet assets. Other Assets if needed expenses for oher assets if needed expenses for oher assets Total Other Assets Total Assets \begin{tabular}{lr} $ & 500 \\ & 500 \\ \hline$ & 1,000 \\ \hline & \\ \hline$ & 1,741,100 \\ \hline \end{tabular} Liabilities \& Net Worth Current Liabilities Accounts Payable Taxes Payable Notes Payable (due within 12 months) Current Portion Long-term Debt Other current liabilities (specify) Total Current Liabilities Long-term Liabilities Bank Loans Payable (greater than 12 months) Less: Short-term Portion Notes Payable to Stockholders Other long-term debt (specify) Total Long-term Liabilities Total Liabilities \begin{tabular}{rr} $r & 2,750,000 \\ 500,000 \\ \hline & \\ \hline & \\ \hline$3,250,000 \\ \hline & \\ \hline$7,650,000 \\ \hline \end{tabular} Owners' Equity (Net Worth) Total Liabilities \& Net Worth \begin{tabular}{l} \hline$(5,908,900) \\ \hline$1,741,100 \\ \hline \end{tabular} Startup Expenses Lopez Steel Company LLC Nearly everyone who has ever started a business has underestimated the costs, and then faced the danger of running with inadequate capital reserves. The key to avoiding this pitfall is to adopt a rigorous approach to your research and planning The Startup Expenses worksheet will lead you through the process. EXPENSES - Begin by estimating expenses. What will it cost you to get your business up and running? The key to accuracy here is attention to detail. For each category of expense, draw up a list of everything you will need to purchase. This will include both tangible assets (for example, equipment, imventory) and services (for example, remodeling, insurance). Then determine where you might purchase these goods or services. Research more than one vendor, Le.: comparison shop. Do not look at price alone; terms of payment, delivery, reliability, and service are also important. CONTINGENCIES - Add a reserve for contingencies. Be sure to explain in your narrative how you decided on the amount you are putting into this reserve. WORKING CAPITAL - You cannot open with an empty bank account, You need a cash cushion to meet expenses while the business gets going. Eventually you should do a 12 -month cash flow projection. This is where you will work out your estimate of working capital needs. For now, either leave this line blank or put in your best rough guess. After you have done your cash flow, you can come back and enter the carefully researched figure. SOURCES - Now that you have estimated how much capital will be needed to start, you should turn your attention to the top part of this worksheet. Enter the amounts you will put in yourself, how much will be injected by partners or investors, and how much will be supplied by borrowing. COLLATERAL - If you will be using this plan to support a bank loan request, use the section near the bottom to show what assets are offered as collateral to secure the loan, and give your estimate of the value of these items. Be prepared to offer some proof of your estimates of collateral values. Location and Admin Expenses \begin{tabular}{lrr} \hline Rent & Related Costs & $ & 2,000 \\ Utility deposits & 300 \\ Legal and accounting fees & 1,000 \\ \hline Prepaid insurance & 5,000 \\ \hline Pre-opening salaries & 2,000 \\ Other & \\ Total Location and Admin Expenses & $ & 10,300 \\ \cline { 2 - 2 } \end{tabular} Opening Inventory \begin{tabular}{lrr} punch in computors & $ & 1,000 \\ face shields & & 100 \\ steel materials & & 2,000 \\ PPE & & 2,000 \\ Category 5 & & \\ \cline { 2 - 3 } Total Inventory & $ & 5,100 \\ \cline { 2 - 3 } \end{tabular} Advertising and Promotional Expenses \begin{tabular}{lrr} \hline Advertising & & 50 \\ Signage & & 200 \\ Printing & & 50 \\ Travelventertainment & & 100 \\ Otherladditional categories & & 200 \\ \cline { 2 - 4 } Total AdvertisinglPromotional Expenses & $ & 600 \\ \cline { 3 - 4 } & & \end{tabular} Other Expenses Other expense 1 if needed Other expense 2 if needed Total Other Expenses Reserve for Contingencies \begin{tabular}{rr} $ & 500 \\ & 500 \\ \hline$ & 1,000 \\ \hline$ & 40,000 \end{tabular} Working Capital $150,000 Summary Statement Sources of Capital \begin{tabular}{llr} \hline Owners' and other investments & $ & 525,000 \\ Bank loans & & 400,000 \\ Other loans & & \\ \cline { 2 - 3 } Total Source of Funds & $925,000 \\ \cline { 2 - 3 } \end{tabular} Startup Expenses Buildings/real estate Leasehold improvements Capital equipment Location/administration expenses Opening inventory Advertising/promotional expenses 0 Other expenses 1 Contingency fund 2 Working capital Total Startup Expenses 1 Loan Guarantors (other than owners) 2 Loan guarantor 1 3 Loan guarantor 2 4 Loan guarantor 3 A balance sheet shows the financial position of your company at a single moment in time; in this case, it will be as of opening day. Use your Startup Expenses spreadsheet to get the basic data for the balance sheet. Here are some accounting rules which will help you construct an accurate balance sheet: Assets are recorded at the lower of cost or current market value. Since your assets will be newly acquired, put them down at cost. If you have donated personal possessions to the business (e.g., a vehicle), enter them at market value. Prepaid Expenses are items like insurance premiums which you have already paid but have not yet "used". Other Assets are intangible items like patents and trademarks which are presumed to have economic value. It is very unlikely that you will have significant Other Assets as a new business. You should also include here items like lease and utility deposits. Current Liabilities are any debts due within twelve months. Trade payables and bank lines of credit are current liabilities. If you have a Long Term (multi year) Debt, then that portion of it which is payable over the next twelve months goes in "Current Portion of Long Term Debt". The remaining portion of that debt then goes in the "Bank Loans Payable (greater than 12 months)" section under Long Term Debt. Owners' Equity is what is left when you subtract Liabilities from Assets. It will be less than you have actually spent on starting your business. That is because many of your pre-opening expenses do not result in ownership of assets which show on a balance sheet. For example, advertising, travel, and legal fees may be necessary, but they do not generate balance sheet assets. Other Assets if needed expenses for oher assets if needed expenses for oher assets Total Other Assets Total Assets \begin{tabular}{lr} $ & 500 \\ & 500 \\ \hline$ & 1,000 \\ \hline & \\ \hline$ & 1,741,100 \\ \hline \end{tabular} Liabilities \& Net Worth Current Liabilities Accounts Payable Taxes Payable Notes Payable (due within 12 months) Current Portion Long-term Debt Other current liabilities (specify) Total Current Liabilities Long-term Liabilities Bank Loans Payable (greater than 12 months) Less: Short-term Portion Notes Payable to Stockholders Other long-term debt (specify) Total Long-term Liabilities Total Liabilities \begin{tabular}{rr} $r & 2,750,000 \\ 500,000 \\ \hline & \\ \hline & \\ \hline$3,250,000 \\ \hline & \\ \hline$7,650,000 \\ \hline \end{tabular} Owners' Equity (Net Worth) Total Liabilities \& Net Worth \begin{tabular}{l} \hline$(5,908,900) \\ \hline$1,741,100 \\ \hline \end{tabular}