Acquisition Projections Builder
Five Years, Year by Year
Year-1 DSCR
2
After the owner salary, as the SBA measures it
Weakest-Year DSCR
2
The year a lender asks about first
Stressed at +2 Points
1.84
Weakest-year coverage if the floating rate steps up; lenders run this before approving
Free Cash, 5 Years
$995,284
After salary, debt, and the capex reserve
The weakest year clears the 1.25 floor the SBA sets for buying a business, and holds it through a 2-point rate step. That is the coverage question answered for the plan, though the lender tests the floor on the last fiscal year and not on a projection; the earnings assumption underneath it is the one still worth arguing with.
Your Return at Exit
A sale in year 5 at $1,656,120 less the $823,824 still owed leaves $832,296 of equity. With $995,284 of free cash along the way, $1,827,580 comes back on $150,000 in: 12.18x, about 132.9% a year. Your salary is pay for the job and is not counted.
| Year | SDE | Debt Service | Free Cash | DSCR | Loan Balance |
|---|---|---|---|---|---|
| 1 | $510,000 | $205,215 | $179,285 | 2 | $1,262,744 |
| 2 | $520,200 | $205,215 | $188,975 | 2.05 | $1,167,303 |
| 3 | $530,604 | $205,215 | $198,859 | 2.1 | $1,062,909 |
| 4 | $541,216 | $205,215 | $208,941 | 2.15 | $948,722 |
| 5 | $552,040 | $205,215 | $219,224 | 2.2 | $823,824 |
Year One, Month by Month
At a flat shape the revenue is as level as the debt service, so every month reads the same and nothing here can run negative. Pick the shape closest to the trade to see which months do.
Months Running Negative
0
Months where the level debt and draw outrun the season
Deepest Cash Hole
$0
The working capital to have at close before the strong season repays it
| Month | SDE | Debt | Draw + Capex | Net | Cumulative |
|---|---|---|---|---|---|
| 1 | $42,500 | $17,101 | $10,458 | $14,940 | $14,940 |
| 2 | $42,500 | $17,101 | $10,458 | $14,940 | $29,881 |
| 3 | $42,500 | $17,101 | $10,458 | $14,940 | $44,821 |
| 4 | $42,500 | $17,101 | $10,458 | $14,940 | $59,762 |
| 5 | $42,500 | $17,101 | $10,458 | $14,940 | $74,702 |
| 6 | $42,500 | $17,101 | $10,458 | $14,940 | $89,643 |
| 7 | $42,500 | $17,101 | $10,458 | $14,940 | $104,583 |
| 8 | $42,500 | $17,101 | $10,458 | $14,940 | $119,523 |
| 9 | $42,500 | $17,101 | $10,458 | $14,940 | $134,464 |
| 10 | $42,500 | $17,101 | $10,458 | $14,940 | $149,404 |
| 11 | $42,500 | $17,101 | $10,458 | $14,940 | $164,345 |
| 12 | $42,500 | $17,101 | $10,458 | $14,940 | $179,285 |
The Quarter, Week by Week
Lowest Point
$26,000
Week 1 of thirteen
Cash at the End
$38,000
$494,000 in, $516,000 out
Runs Out
Not this quarter
The account stays positive throughout
The account never goes negative, but week 1 leaves less than one week of costs in it. That is a quarter with no room for a late payer.
| 1 | $38,000 | $72,000 | -$34,000 | $26,000 |
| 2 | $38,000 | $14,000 | $24,000 | $50,000 |
| 3 | $38,000 | $48,000 | -$10,000 | $40,000 |
| 4 | $38,000 | $14,000 | $24,000 | $64,000 |
| 5 | $38,000 | $72,000 | -$34,000 | $30,000 |
| 6 | $38,000 | $14,000 | $24,000 | $54,000 |
| 7 | $38,000 | $48,000 | -$10,000 | $44,000 |
| 8 | $38,000 | $14,000 | $24,000 | $68,000 |
| 9 | $38,000 | $72,000 | -$34,000 | $34,000 |
| 10 | $38,000 | $14,000 | $24,000 | $58,000 |
| 11 | $38,000 | $48,000 | -$10,000 | $48,000 |
| 12 | $38,000 | $14,000 | $24,000 | $72,000 |
| 13 | $38,000 | $72,000 | -$34,000 | $38,000 |
Weekly rather than monthly on purpose: a business can clear its costs across a month and still miss payroll in the week the loan payment and an insurance renewal land together, which is exactly what a monthly view averages away. The loan payment lands every fourth week and a two-week payroll in the odd ones, so read the trough as the shape of the quarter rather than as a date. If it goes negative, the first row of the year-one troubles is the move.