Financial Guide for SMEs - SME Corporation Malaysia

Financial Guide for SMEsWe can see Adam is now confident that, in the second year, he can increase hissales by 50%. Of course, with increased sales, comes an increase in expenditureto support the sales. Therefore, he has developed a plan of what the year twoincome statement will look like.RevenueSalesTotal SalesCost of Goods Sold (COGS)Opening inventoryInventory purchasesLess closing inventoryTotal Cost of Goods SoldGross ProfitExpensesAdvertisingBank service chargesInsurancePayrollProfessional fees (legal,accounting)StationeryUtilities & telephoneVehicle expensesOther: computer softwareExpenses totalAdam’s Computer BagsIncome StatementAs at end of Year OneRM 52,000RM 52,000RM -RM 34,320RM 3,120RM 31,200RM 20,800RM 15,600As at end of Year OneRM 78,000RM 78,000RM 3,120RM 49,920RM 6,240RM 46,800RM 31,200RM 500 RM 1,000RM 120 RM 200RM 500 RM 550RM 13,000 RM 19,500RM 200 RM 4200RM 250RM 800 RM 8800RM 2,450RM 480 RM 100RM 25,350Net Profit Before TaxRM 5,200 RM 5,850Adam will need to monitor his actual results, checking them against this budget,to ensure that his plan will be achieved.TIPWhen documenting your assumptions, include both the risk assessment ofeach assumption and the anticipated action required to match the risk. Bydoing this, you will be well prepared and have an action plan already in placeif the actual events do not match your assumptions35Chapter 2-5 p22-65 Eng.indd 358/15/11 5:01:53 PM