Homework: Venture Capital
More of the Basics and Beyond
Overview
Using the same business you started in the first homework, Your Business Venture, you will continue to build a financial plan for the business.
Instructions
Write a 4 to 5 pages paper in which you:
A. Prepare a pro forma balance sheet for the first 12 months of your business. Include the assumptions on which it is based. Justify your balance sheet.
B. Prepare a pro forma income statement for the first 12 months of your business. Include the assumptions on which it is based. Justify your income statement.
C. Prepare a pro forma cash budget for the first 12 months of your business. Include the assumptions that you have made when creating the budget. Justify your budget.
D. Scrutinize tangible and intangible costs of obtaining financial capital for your business start-up to determine whether the costs justify the implementation of the funding source.
E. Assume your business is five years old and running profitably and consider how you would grow your business over the next five years. Determine the specific details that would make the equity approach to valuing your business worthwhile. Provide a rationale with your response.
Format your homework according to the give formatting requirements:
1. The answer must be double spaced, typed, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the homework, the course title, the student's name, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The references and Citations should follow APA format. The reference page is not included in the required page length.
The specific course learning outcome associated with this homework is:
1. Assess whether the costs of obtaining capital for a business justify use of the funding source, and whether equity-based valuation of the business is appropriate.