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Case Study – NorCal Cannabis Cultivation Company (NCCCC)    1
Case Study – NorCal Cannabis Cultivation Company (NCCCC)    1    8
CASE STUDY – NORCAL CANNABIS CULTIVATION COMPANY (NCCCC)
Table of Content
Solution 1    3
Solution 2    5
Solution 3    6
Solution 4    6
Solution 5    8
Solution 6    8
Solution 7    13
References    14
Solution 1
    NorCal Cannabis Cultivation Company (NCCCC) - Proforma Income Statement
    Particulars
    Year 1
    Year 2
    Year 3
    Year 4
    Year 5
    Revenue
    1720867
    2796409
    2946985
    2968496
    2968496
    COGS - Cost of Goods Sold
    564145
    760584
    798969
    808325
    813915
    Gross Profit
    1156722
    2035825
    2148016
    2160171
    2154581
    % Of revenue
    67%
    73%
    73%
    73%
    73%
     
     
     
     
     
     
    SG&A Expenses:
     
     
     
     
     
    G&A Expenses - Initial & General Costs
    243500
    199305
    205110
    210915
    216720
    G&A Expenses - Cultivation
    396813
    450187
    463645
    476457
    489162
    SG&A Expenses - Marketing and Sales Expenses
    45833
    56650
    58300
    59950
    61600
    Senior Management Salaries and Benefits
    114650
    120383
    126115
    131848
    137580
    IT Salaries & Benefits
    0
    0
    0
    0
    0
    Other Salaries & Benefits
    0
    0
    0
    0
    0
    SG&A Expenses - Misc.
    26807
    30157
    31053
    31916
    32774
    Total SG&A Expenses
    827603
    856682
    884223
    911086
    937836
     
     
     
     
     
     
    Operating Income (EBITDA)
    329120
    1179144
    1263794
    1249085
    1216745
    % Of revenue
    19%
    42%
    43%
    42%
    41%
     
     
     
     
     
     
    Depreciation and Amortization
    42967
    46873
    46873
    46873
    46873
     
     
     
     
     
     
    Earnings Before Interest & Taxes (EBIT)
    286152
    1132270
    1216921
    1202212
    1169872
     
     
     
     
     
     
    Interest Expenses
    -88339
    -84479
    -72999
    -60063
    -38993
     
     
     
     
     
     
    Earnings Before Taxes (EBT)
    197813
    1047791
    1143922
    1142149
    1130879
     
     
     
     
     
     
    Income Tax
    347017
    610748
    644405
    648051
    646374
    Net Income
    -149203
    437044
    499517
    494098
    484504
    % Of revenue
    -9%
    16%
    17%
    17%
    16%
    NorCal Cannabis Cultivation Company (NCCCC) - Proforma Balance Sheet
    Particulars
    Year 1
    Year 2
    Year 3
    Year 4
    Year 5
    Assets
     
     
     
     
     
    Cu
ent Assets
     
     
     
     
     
    Cash
    336727
    634187
    1000149
    1366353
    1752130
    Receivables
    107554
    118310
    123687
    123687
    123687
    Inventory
    32347
    35999
    37465
    37465
    37465
    Total Cu
ent Assets
    476629
    788496
    1161302
    1527505
    1913283
     
     
     
     
     
     
    Long Term Assets
     
     
     
     
     
    Property Plant & Equipment (PPE), Gross
    716429
    716429
    716429
    716429
    716429
    Accumulated Depreciation of PPE
    -42967
    -89840
    -136714
    -183587
    -230460
    PP&E, net
    673462
    626588
    579715
    532842
    485969
    Total Assets
    1150091
    1415084
    1741017
    2060347
    2399252
     
     
     
     
     
     
    Liabilities
     
     
     
     
     
    Cu
ent Liabilities
     
     
     
     
     
    Accounts Payable
    28460
    31410
    32826
    33059
    33292
    Accrued Expenses
    0
    0
    0
    0
    0
    Total Cu
ent Liabilities
    28460
    31410
    32826
    33059
    33292
     
     
     
     
     
     
    Long Term Liabilities
    670833
    495833
    320833
    145833
    0
    Total Liabilities
    699293
    527243
    353659
    178892
    33292
     
     
     
     
     
     
    Equity
     
     
     
     
     
    Paid-in capital/ drawings
    600000
    600000
    600000
    600000
    600000
    Retained Earnings
    -149203
    287841
    787357
    1281455
    1765959
    Cu
ent Period Retained Earnings
    450797
    887841
    1387357
    1881455
    2365959
    Total Equity
    450797
    887841
    1387357
    1881455
    2365959
    Total Liabilities and Equity
    1150090
    1415084
    1741016
    2060347
    2399251
    NorCal Cannabis Cultivation Company (NCCCC) - Proforma Statement of Cash flows
    Particulars
    Year 1
    Year 2
    Year 3
    Year 4
    Year 5
    Net Income
    -149203
    437044
    499517
    494098
    484504
     
     
     
     
     
     
    Cash flow from Operations
     
     
     
     
     
    Depreciation
    42967
    46873
    46873
    46873
    46873
    Change in Receivables
    -107554
    -10755
    -5378
    0
    0
    Change in Inventory
    -32347
    -3652
    -1466
    0
    0
    Change in Accounts Payable
    28460
    2950
    1416
    233
    233
    Total Cash Flow from Operations
    -217677
    472460
    540962
    541204
    531610
     
     
     
     
     
     
    Cash Flow from Investing
     
     
     
     
     
    Capital Expenditures (CAPEX)
    -750000
    0
    0
    0
    0
    Othe
    0
    0
    0
    0
    0
    Total Cash flow from Investing
    -750000
    0
    0
    0
    0
     
     
     
     
     
     
    Cash Flow from Financing
     
     
     
     
     
    Revolver Issuance/ (Repayment)
    0
    0
    0
    0
    0
    Long-Term Debt Issuance/ (Repayment)
    670833
    -175000
    -175000
    -175000
    -145833
    Paid in Capital
    600000
    0
    0
    0
    0
    Drawings (Profit share)
    0
    0
    0
    0
    0
    Total Cash Flow from Financing
    1270833
    -175000
    -175000
    -175000
    -145833
     
     
     
     
     
     
    Total Change in Cash
    303156
    297460
    365962
    366204
    385777
    Beginning Period Cash
    0
    303156
    600616
    966578
    1332782
    Ending Period Cash
    303156
    600616
    966578
    1332782
    1718559
Solution 2
    Capital for starting and operating Cannabis Business
    Items
    Amount in $
    Capital Cost
    7500000
We have a
ived at this figure by multiplying the 6 greenhouse units with 10000 square feet. Then this figure is multiplied by $100...