4. Question – which assumptions are the most significant? For one quarter? For the year? $100,000 18% 60% $3,000 35 days 50 days $350,000 $30,000 8% 15% 91% PLAN Sales performance vs. quota Executive compensation Interest rates paid % of equipment purchases financed Spending on new computers for each hire How fast we pay creditors How fast customers pay us Spending on marketing programs Annual travel expenses Commission rates Annual maintenance fees
5. These are the most significant assumptions -2 -- -1 -- -16 -55 -5 -1 +2 -3 -2 $ effect of a (10%) dif One quarter 2 1 Rank 2 3 1 Rank Annual -7 -1 -3 -2 -14 -75 -18 -6 -10 -26 -127 $ effect of a (10%) dif PLAN 91% Sales performance vs. quota $100,000 Executive compensation 18% Interest rates paid 60% % of equipment purchases financed $3,000 Spending on new computers for each hire 35 days How fast we pay creditors 50 days How fast customers pay $350,000 Spending on marketing programs $30,000 Annual travel expenses 8% Commission rates 15% Annual maintenance fees
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