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Cash Flow Projections

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					                          HyperCompuGlobalMegaNet Corporation
                           Assumptions for Financial Projections
Description                                 Value Comment
Revenue Assumptions
 Unit Sales Price                            $249   per MP3 player sold
 Overall Market Size                    5,000,000   potential customers
 Target Market Size                       475,000   potential customers in niche
 Year One Sales Projections                 5,000   units sold
 Year Two Sales Projections                 7,000   units sold
 Year Three Sales Projections              11,000   units sold

Variable Cost Assumptions
 Materials                                   $50    per MP3 player sold
 Labor                                       $20    per MP3 player sold
 Overhead                                    $10    per MP3 player sold
 Sales Commission (%)                         6%    of Unit Sale Price
 Sales Commission ($)                        $15    per MP3 player sold

Fixed Cost Assumptions
  Plant Operations                      $500,000    per year
  Telecommunications                      $8,000    per year; includes phones and internet
  Legal Services                         $20,000    per year
  Accounting Services                    $20,000    per year
  Insurance                             $100,000    per year

Personnel Assumptions
 Administrative Personnel (#)                  2
 Salary per Admin. ($)                   $28,000 per admin
 Admin. Salaries ($)                     $56,000

 Salespeople (#)                               6
 Base Salary per Salesperson ($)         $24,000 per salesperson
 Sales Base Salaries ($)                $144,000

 Personnel Overead Rate (%)                  15% of total salaries
 Personnel Overhead ($)                  $30,000

Start-Up Cost Assumptions
  Plant Site Development               $1,500,000 one-time cost to build manufactory
  Equipment Costs                        $750,000 one-time cost to purchase equipment
  Working Capital                        $500,000

Financing Assumptions
  Capital from Investors               $1,500,000   from sale of 25% equity in company
  Capital from Commercial Loan         $1,250,000
  Loan Interest Rate                           7%   annual percentage rate (APR)
  Loan Term                                    20   years; lifetime of loan
  Periods per Year                             12   payment periods per year
  Total Periods                               240   periods for life of loan
  Monthly Loan Servicing Cost           $9,691.24
  Annual Loan Servicing Cost          $116,294.84
                            HyperCompuGlobalMegaNet Corporation
                               Three Year Cash Flow Projections
                                         INITIAL   YEAR ONE     YEAR TWO YEAR THREE

STARTING CASH
       Cash at Start of Period             $0     $500,000     $276,005     $360,130


CASH FLOWS FROM OPERATIONS
+ Revenues from Sales                            $1,245,000   $1,743,000   $2,739,000

- Variable Costs
   - Materials                                    $250,000     $350,000     $550,000
   - Labor                                        $100,000     $140,000     $220,000
   - Overhead                                      $50,000      $70,000     $110,000
   - Sales Commissions                             $74,700     $104,580     $164,340

- Fixed Costs
    - Plant Operations                            $500,000     $500,000     $500,000
    - Telecommunications                            $8,000       $8,000       $8,000
    - Legal Services                               $20,000      $20,000      $20,000
    - Accounting Services                          $20,000      $20,000      $20,000
    - Insurance Services                          $100,000     $100,000     $100,000

- Personnel Costs
   - Admin Salaries                                $56,000      $56,000      $56,000
   - Sales Salaries                               $144,000     $144,000     $144,000
   - Personnel Overhead                            $30,000      $30,000      $30,000

           Operations Sub-Total                  ($107,700)    $200,420     $816,660


CASH FLOWS FROM INVESTMENTS
   - Plant Site Development     $1,500,000
   - Equipment                    $750,000
         Investments Sub-Total ($2,250,000)             $0           $0           $0


CASH FLOWS FROM FINANCING ACTIVITIES
  + Sale of Equity          $1,500,000
  + Commercial Loan         $1,250,000
  - Loan Repayment                                $116,295     $116,295     $116,295

            Financing Sub-Total     $2,750,000   ($116,295)   ($116,295)   ($116,295)


ENDING CASH
        Cash at End of Period         $500,000    $276,005     $360,130    $1,060,495

				
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