In practical terms, your forecast should be broken down by monthly sales with entries showing which units are being sold, their price points, and how many you expect to sell.
When getting into the second year of your business plan and beyond, it's acceptable to reduce the forecast to quarterly sales.
For example, certain expenses will be the same or close to the same every month, including rent, insurance, and others.
Some costs likely will vary month by month such as advertising or seasonal sales help.
Be sure to follow the generally accepted accounting principles (GAAP) set forth by the Financial Accounting Standards Board, a private-sector organization responsible for setting financial accounting and reporting standards in the U. If financial reporting is new territory for you, have an accountant review your projections.
As a startup business, you do not have past results to review, which can make forecasting sales difficult.
As with your sales forecast, cash flow statements for a startup require doing some homework since you do not have historical data to use as a reference.
This statement, in short, breaks down how much cash is coming into your business on a monthly basis vs. By using your sales forecasts and your expenses budget, you can estimate your cash flow intelligently.
You provide a breakdown of all of your assets and liabilities in the balances sheet.
Many of these assets and liabilities are items that go beyond monthly sales and expenses.