You are at the end of 2010 and you found a great potential to sell drones to the public. You want develop products as competitive as the Parrot AR.Drone, a smartphone-controlled video camera quadricopter.

You analysed the market, the technology and the environment and you developed the following hypotheses for your business plan:

You want to develop two innovative products in 2010, one cheap at 100 and one more developed at 250.

Based on a market study, forecasts for the sales of those drones are the following:

Number of drones	2012	2013	2014	2015	2016
Cheap product	10 000	20 000	40 000	60 000	80 000
Developed product	5 000	10 000	20 000	30 000	40 000

Variable costs include raw materials and distribution costs and are estimated to be 50% of the sales.

Fixed costs include the development costs, employees wages and marketing costs. They are however increasing in stages as the company is supposed to grow.

In	2011	2012	2013	2014	2015	2016
Fixed cost	400 000	1 000 000	1 000 000	1 500 000	2 000 000	2 000 000

To manufacture the drones, you need to invest in a factory for 5 000 000 that will be linearly depreciated over 20 years.

The working capital needs should represent 2 months of sales (sales in 2017 are estimated to amount to 22 000 000)

Taxes on corporate income is 33% (a tax credit can be taken into account when the company is running losses).

1. Build a forecasted income statement for the next 6 years (2011-2016). Draw a table showing explicitly the logics of your calculations for each line.
2. Build a forecasted cash flow statement including Cash Flows from Operations and Cash Flows from Investments for the next 6 years (2011-2016). Draw a table showing explicitly the logics of your calculations for each line.