Simulation

Description of the company in the "simulator"

The company is still the same as before, a small car-sales company with one employee (at least in the first year). As opposed to the simple simulator, it will here also be possible to hire another salesperson

The initial employee has a cost (sallary for that person) of 1 000 000 SEK a year. The premises from where the salesperson sells the cars costs 20 000 SEK a month in rent (rented premises does not effect the balance sheet).

The company starts off the 1st year with 5 cars in stock. Each car (all are the same) are bought for 180 000 SEK and sold for 200 000 SEK. As the company does not have more space than the showroom, they cannot buy more cars until they have room for it.

The cars paid for directly when they are delivered. Each car is taken into the balance sheet at the value for which they are purchased. They depriciate to zero value in 5 years time.

The main variable in the simulator is how many cars that are sold per year in the company. There is a limit however, at 12 cars per month as the salesman is not able to sell that much. More than that, a new salesperson is needed.

Cars are bought with 50% leverage (i.e. they are bought with 50% equity (from the companys own cash) and 50% short term interest bearing debt)

The company has an equity of 1 MSEK at the end of the first year and no amortisation are made. Below, for each year it is possible for the user to edit some parameters for each year; cars sold, employees, cars in stock on average and at the end of the year as well as dividend for each year, these fields are marked in green (Year 1 onwards). I am re-working the model, I'll get back with a new version within the next couple of weeks