Gap Calculator Company Name: Description:

1. Enter your projected sales and profit amount (or percentage).

The Gap Calculator will compute the amount of financing you'll need assuming you operate at the same level of efficiency as in your most recent financial year.

To grow from $ to $ in sales you'll need $ in financing, assuming you operate at the projected level of efficiency.

What Does Financial Gap Indicate?

Financial Gap is the difference between the funds you need to support future growth and the funds you have on hand. If you attempt to grow without addressing this gap, you may experience cash flow problems. Excess cash is the opposite of Financial Gap. (In other words, you have more funds available than you need.) If you think you can better manage your assets or liabilities in the future, you can alter your projection to see if it changes your Financial Gap.

Try Some What-if?’s

To alter your projection, change either the dollar amount or the percentage of sales for the area you want to alter and review the effect on your Financial Gap. (Non-variable assets and liabilities can only be entered in dollar amounts.) For example, what if I:

• Turned inventory and collected accounts receivable faster? Decrease amounts in these areas.
• Obtained financing? Increase long-term liabilities.
• Made more profit? Increase projected profits.
• Sold existing unproductive assets? Decrease asset amounts.
• Curtailed expansion? Reduce projected sales.
• Got new equity? Increase net worth.