EQUIPMENT REQUIRED Tax:

Operating EquipmentDVD Machine 15,624Total 15,624 0 1

Office EquipmentPrinter 76Telephone Fax 217Computer 651Desk 293Chair 114Total 1,351

Office SuppliesPaper 326Ink 217Miscellaneous 217Total 760

InventoryDVD discs 9,732Repair Kit 2,517Total 12,250

TOTAL 29,984

Things Needed to Start Your New Venture*Assets

Operating Equipment 15,624FurnitureFixturesOffice Equipment 1,351Office Supplies 760Operating Supplies 12,250TOTAL 29,984

Utility DepositsLicenses and Permits 25Remodeling/Renovation Grand OpeningProfessional Fees

Survival Cash*** 5,000Total Cost 35,009Equity 5,000Loan Required 30,009

*This is a summary list and should be expanded as needed to make a complete list. A chart of accounts has been provided.**One time expenditures needed to get started.***We will calculate this after we have done the cash flow.

One Time Pre Business Expenses**

1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th TotalYear 1 1,569 1,569 1,569 2,479 2,479 2,479 2,479 2,975 2,975 2,975 2,975 2,975 29,497Year 2 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,978 4,978 52,238Year 3 4,978 4,978 4,978 4,978 4,978 6,547 6,547 6,547 7,297 7,297 7,297 7,297 73,719

50 members and 20 dvd's sold80 members and 30 dvd's sold100 members and 30 dvd's sold150 members and 30 dvd's sold180 members and 30 dvd's soldSecond machine installed in Monroe 230 members and 50 dvd's sold260 members and 50 dvd's sold

Wages and SalariesNumber Hours Rate Wkly Annual

Type Employee I 1.00 100.00 5200.00Type Employee II

AdvertisingYellow PagesBurlington Free Press

Total

InsuranceGeneral Liability 625.00Property Insurance 1393.68Workers Comp

Total

Utilities (monthly)Cable TV Telephone 588.00Electricity 360.00GasWater and Sewer

Total 8166.68

Depreciation

Page 1

Name of the CompanyDepreciation Schedule

Personal MACRS

471.476 2828.85Assets being depreciated telecommunication 2514 209.498 2513.97Basis of depreciation 16,975 2828.85458625 471.476 5342.83Recovery period 3 5343 680.973

Year Rate (%) Depreciation Expense1 33.33 5,657.71 2 44.45 7,545.31 3 14.81 2,513.97 4 7.41 1,257.83

16,974.83

Depreciation_2

Page 2

Name of the CompanyDepreciation Schedule

Personal MACRS

Assets being depreciated telecommunication 433.957 3037.7Basis of depreciation 15,624 2314 192.826 2313.91Recovery period 3 2603.7396 433.957 5351.61

4918 626.783

Year Rate (%) Depreciation Expense1 33.33 5,207.48 2 44.45 6,944.87 3 14.81 2,313.91 4 7.41 1,157.74

15,624.00

Amortization

Page 3

DVD MAXAmortization Schedule

Principal $30,009 Terms in Months 36Interest Rate 9.00% Monthly PMT $954.28 Terms 3 (- in years) Annual PMT $11,451.33

Payment Interest Principal BalanceYear One 1 954.28 225.07 729.21 29,279.76

2 954.28 219.60 734.68 28,545.093 954.28 214.09 740.19 27,804.904 954.28 208.54 745.74 27,059.165 954.28 202.94 751.33 26,307.826 954.28 197.31 756.97 25,550.857 954.28 191.63 762.65 24,788.218 954.28 185.91 768.37 24,019.849 954.28 180.15 774.13 23,245.71

10 954.28 174.34 779.93 22,465.7811 954.28 168.49 785.78 21,679.9912 954.28 162.60 791.68 20,888.32

Total 11,451.33 2,330.67 9,120.66

Year Two 1 954.28 156.66 797.62 20,090.702 954.28 150.68 803.60 19,287.103 954.28 144.65 809.62 18,477.484 954.28 138.58 815.70 17,661.785 954.28 132.46 821.81 16,839.976 954.28 126.30 827.98 16,011.997 954.28 120.09 834.19 15,177.818 954.28 113.83 840.44 14,337.369 954.28 107.53 846.75 13,490.61

10 954.28 101.18 853.10 12,637.5211 954.28 94.78 859.50 11,778.0212 954.28 88.34 865.94 10,912.08

Total 11,451.33 1,475.09 9,976.24

Year Three 1 954.28 81.84 872.44 10,039.642 954.28 75.30 878.98 9,160.663 954.28 68.70 885.57 8,275.094 954.28 62.06 892.21 7,382.885 954.28 55.37 898.91 6,483.976 954.28 48.63 905.65 5,578.327 954.28 41.84 912.44 4,665.888 954.28 34.99 919.28 3,746.609 954.28 28.10 926.18 2,820.42

10 954.28 21.15 933.12 1,887.3011 954.28 14.15 940.12 947.1712 954.28 7.10 947.17 0.00

Total 11,451.33 539.25 10,912.08

First Year Income Statement

Sales 29,497Cost of Sales 4,293Gross Profit 25,204

Operating ExpensesWages and Salaries 5,200Payroll Taxes* 398Rent 3,000Advertising Insurance 2,019Utilities(water etc.) 360TravelProfessional FeesRepairs/Maintenance 1,800Cleaning ServiceOffice SuppliesPhone 588Depreciation** 5,658Interest Expense*** 2,331Others????

Total Operating Expenses 21,353Profit Before Taxes 3,851

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

First Year Income StatementFirst Year 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th

Sales 29,497 1,569 1,569 1,569 2,479 2,479 2,479 2,479 2,975 2,975 2,975 2,975 2,975Cost of Sales 4,293 260 260 260 390 390 390 390 390 390 390 390 390Gross Profit 25,204 1,309 1,309 1,309 2,089 2,089 2,089 2,089 2,584 2,584 2,584 2,584 2,584

Operating ExpensesWages and Salaries 5,200 433 433 433 433 433 433 433 433 433 433 433 433Payroll Taxes* 398 33 33 33 33 33 33 33 33 33 33 33 33Rent 3,000 250 250 250 250 250 250 250 250 250 250 250 250Advertising Insurance 2,019 2,019Utilities(water etc.) 360 30 30 30 30 30 30 30 30 30 30 30 30TravelProfessional FeesRepairs/Maintenance 1,800 150 150 150 150 150 150 150 150 150 150 150 150Cleaning ServiceOffice Supplies 0 0 0 0 0 0 0 0 0 0 0 0 0Phone 588 49 49 49 49 49 49 49 49 49 49 49 49Depreciation** 5,658 471 471 471 471 471 471 471 471 471 471 471 471Interest Expense*** 2,331 225 220 214 209 203 197 192 186 180 174 168 163Others????

Total Operating Expenses 21,353 3,661 1,637 1,631 1,625 1,620 1,614 1,609 1,603 1,597 1,591 1,585 1,580Profit Before Taxes 3,851 -2,352 -327 -322 463 469 474 480 982 987 993 999 1,005

13.06%

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

First Year Cash FlowCash Receipts First Year 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12thCash Sales 29,497 1,569 1,569 1,569 2,479 2,479 2,479 2,479 2,975 2,975 2,975 2,975 2,975Loan Proceeds 30,009 30,009Equity Injection 5,000 5,000Total Cash Receipts 64,506 36,578 1,569 1,569 2,479 2,479 2,479 2,479 2,975 2,975 2,975 2,975 2,975

Cash DisbursementsEquipment 16,975 16,975Supplies 13,009 13,009

Purchases 4,293 260 260 260 390 390 390 390 390 390 390 390 390Wages and Salaries 5,200 433 433 433 433 433 433 433 433 433 433 433 433Payroll Taxes* 398 33 33 33 33 33 33 33 33 33 33 33 33Rent 3,000 250 250 250 250 250 250 250 250 250 250 250 250Advertising 0Insurance 2,019 2,019Utilities(water etc.) 360 30 30 30 30 30 30 30 30 30 30 30 30Travel 0 0 0 0 0 0 0 0 0 0 0 0 0Professional Fees 0 0 0 0 0 0 0 0 0 0 0 0 0Repairs/Maintenance 1,800 150 150 150 150 150 150 150 150 150 150 150 150Office Supplies 0 0 0 0 0 0 0 0 0 0 0 0 0Phone 588 49 49 49 49 49 49 49 49 49 49 49 49Note Payment 11,451 954 954 954 954 954 954 954 954 954 954 954 954Others???? 25 25

Total Cash Disbursements 59,118 34,188 2,160 2,160 2,290 2,290 2,290 2,290 2,290 2,290 2,290 2,290 2,290Net Cash Flow 5,388 2,391 -591 -591 189 189 189 189 685 685 685 685 685Beginning Cash 0 0 2,391 1,800 1,209 1,398 1,587 1,776 1,965 2,650 3,334 4,019 4,704Ending Cash 5,388 2,391 1,800 1,209 1,398 1,587 1,776 1,965 2,650 3,334 4,019 4,704 5,388

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

Second Year Income Statement

Sales 52,238Cost of Sales 4,683Gross Profit 47,555

Operating ExpensesWages and Salaries 5,200Payroll Taxes* 398Rent 3,000Advertising Insurance 2,019Utilities(water etc.) 360TravelProfessional FeesRepairs/Maintenance 1,800Cleaning ServiceOffice SuppliesPhone 588Depreciation** 7,545Interest Expense*** 1,475Others????

Total Operating Expenses 22,385Profit Before Taxes 25,170

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

Second Year Income StatementYear 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th

Sales 52,238 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,978 4,978Cost of Sales 4,683 390 390 390 390 390 390 390 390 390 390 390 390Gross Profit 47,555 3,838 3,838 3,838 3,838 3,838 3,838 3,838 3,838 3,838 3,838 4,588 4,588

Operating ExpensesWages and Salaries 5,200 433 433 433 433 433 433 433 433 433 433 433 433Payroll Taxes* 398 33 33 33 33 33 33 33 33 33 33 33 33Rent 3,000 250 250 250 250 250 250 250 250 250 250 250 250Advertising Insurance 2,019 2,019Utilities(water elect etc.) 360 30 30 30 30 30 30 30 30 30 30 30 30TravelProfessional FeesRepairs/Maintenance 1,800 150 150 150 150 150 150 150 150 150 150 150 150Cleaning ServiceOffice Supplies 0 0 0 0 0 0 0 0 0 0 0 0 0Phone 588 49 49 49 49 49 49 49 49 49 49 49 49Depreciation** 7,545 629 629 629 629 629 629 629 629 629 629 629 629Interest Expense*** 1,475 157 151 145 139 132 126 120 114 108 101 95 88Others????

Total Operating Expenses 22,385 3,750 1,725 1,719 1,713 1,707 1,701 1,694 1,688 1,682 1,675 1,669 1,663Profit Before Taxes 25,170 88 2,113 2,119 2,125 2,131 2,137 2,144 2,150 2,156 2,162 2,919 2,925

48.18%

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

Second Year Cash FlowCash Receipts First Year 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12thCash Sales 52,238 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,978 4,978Loan Proceeds 0 0Equity Injection 0 0Total Cash Receipts 52,238 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,228 4,978 4,978

Cash DisbursementsPurchases 4,683 390 390 390 390 390 390 390 390 390 390 390 390Wages and Salaries 5,200 433 433 433 433 433 433 433 433 433 433 433 433Payroll Taxes* 398 33 33 33 33 33 33 33 33 33 33 33 33Rent 3,000 250 250 250 250 250 250 250 250 250 250 250 250Advertising 0Insurance 2,019 2,019 0 0 0 0 0 0 0 0 0 0 0Utilities(water etc.) 360 30 30 30 30 30 30 30 30 30 30 30 30Travel 0 0 0 0 0 0 0 0 0 0 0 0 0Professional Fees 0 0 0 0 0 0 0 0 0 0 0 0 0Repairs/Maintenance 1,800 150 150 150 150 150 150 150 150 150 150 150 150Office Supplies 0 0 0 0 0 0 0 0 0 0 0 0 0Phone 588 49 49 49 49 49 49 49 49 49 49 49 49Note Payment 11,451 954 954 954 954 954 954 954 954 954 954 954 954Others???? 0

Total Cash Disbursements 29,499 4,309 2,290 2,290 2,290 2,290 2,290 2,290 2,290 2,290 2,290 2,290 2,290Net Cash Flow 22,739 -81 1,938 1,938 1,938 1,938 1,938 1,938 1,938 1,938 1,938 2,688 2,688Beginning Cash 5,388 5,388 5,308 7,246 9,184 11,122 13,060 14,999 16,937 18,875 20,813 22,751 25,439Ending Cash 28,127 5,308 7,246 9,184 11,122 13,060 14,999 16,937 18,875 20,813 22,751 25,439 28,127

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

Third Year Income Statement

Sales 73,719Cost of Sales 6,505Gross Profit 67,214

Operating ExpensesWages and Salaries 8,233Payroll Taxes* 630Rent 4,750Advertising Insurance 4,037Utilities(water etc.) 570TravelProfessional FeesRepairs/Maintenance 2,850Cleaning ServiceOffice SuppliesPhone 588Depreciation** 5,552Interest Expense*** 539Others????

Total Operating Expenses 27,749Profit Before Taxes 39,465

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

Third Year Income StatementFirst Year 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th

Sales 73,719 4,978 4,978 4,978 4,978 4,978 6,547 6,547 6,547 7,297 7,297 7,297 7,297Cost of Sales 6,505 390 390 390 390 390 650 650 650 650 650 650 650Gross Profit 67,214 4,588 4,588 4,588 4,588 4,588 5,897 5,897 5,897 6,646 6,646 6,646 6,646

Operating ExpensesWages and Salaries 8,233 433 433 433 433 433 867 867 867 867 867 867 867Payroll Taxes* 630 33 33 33 33 33 66 66 66 66 66 66 66Rent 4,750 250 250 250 250 250 500 500 500 500 500 500 500Advertising Insurance 4,037 2,019 2,019Utilities(water etc.) 570 30 30 30 30 30 60 60 60 60 60 60 60TravelProfessional FeesRepairs/Maintenance 2,850 150 150 150 150 150 300 300 300 300 300 300 300Cleaning ServiceOffice Supplies 0 0 0 0 0 0 0 0 0 0 0 0 0Phone 588 49 49 49 49 49 49 49 49 49 49 49 49Depreciation** 5,552 209 209 209 209 209 643 643 643 643 643 643 643Interest Expense*** 539 82 75 69 62 55 49 42 35 28 21 14 7Others????

Total Operating Expenses 27,749 3,255 1,230 1,224 1,217 1,210 4,553 2,527 2,520 2,514 2,507 2,500 2,493Profit Before Taxes 39,465 1,332 3,357 3,364 3,371 3,377 1,344 3,369 3,376 4,133 4,140 4,147 4,154

53.53%

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

Third Year Cash FlowCash Receipts First Year 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12thCash Sales 73,719 4,978 4,978 4,978 4,978 4,978 6,547 6,547 6,547 7,297 7,297 7,297 7,297Loan Proceeds 0 0Equity Injection 0 0Total Cash Receipts 73,719 4,978 4,978 4,978 4,978 4,978 6,547 6,547 6,547 7,297 7,297 7,297 7,297

Cash DisbursementsPurchases 35,138 390 390 390 390 390 29,284 650 650 650 650 650 650Wages and Salaries 8,233 433 433 433 433 433 867 867 867 867 867 867 867Payroll Taxes* 630 33 33 33 33 33 66 66 66 66 66 66 66Rent 4,750 250 250 250 250 250 500 500 500 500 500 500 500Advertising 0Insurance 4,037 2,019 0 0 0 0 2,019 0 0 0 0 0 0Utilities(water etc.) 570 30 30 30 30 30 60 60 60 60 60 60 60Travel 0 0 0 0 0 0 0 0 0 0 0 0 0Professional Fees 0 0 0 0 0 0 0 0 0 0 0 0 0Repairs/Maintenance 2,850 150 150 150 150 150 300 300 300 300 300 300 300Office Supplies 0 0 0 0 0 0 0 0 0 0 0 0 0Phone 588 49 49 49 49 49 49 49 49 49 49 49 49Note Payment 11,451 954 954 954 954 954 954 954 954 954 954 954 954Others???? 0

Total Cash Disbursements 68,248 4,309 2,290 2,290 2,290 2,290 34,099 3,447 3,447 3,447 3,447 3,447 3,447Net Cash Flow 5,471 669 2,688 2,688 2,688 2,688 -27,551 3,100 3,100 3,850 3,850 3,850 3,850Beginning Cash 28,127 28,127 28,796 31,484 34,172 36,860 39,548 11,996 15,097 18,197 22,047 25,898 29,748Ending Cash 33,598 28,796 31,484 34,172 36,860 39,548 11,996 15,097 18,197 22,047 25,898 29,748 33,598

*See attached schedule**Depreciation schedules provided on separate workbook.***Amortization schedules provided on separate workbook.

Balance SheetsBeginning 1st 2nd 3rd

AssetsFixed Assets 16,975 16,975 16,975 32,599

0 5,658 13,203 18,755 Total Fixed Assets 16,975 11,317 3,772 13,844 Current Assets

Supplies 13,009 13,009 13,009 26,018 Cash 5,000 5,388 28,127 33,598 Total Current 18,009 18,397 41,136 59,616

Total Assets 34,984 29,714 44,908 73,460

Liabilities

Long Term 30,009 20,888 10,912 0

Short TermTotal Liabilities 30,009 20,888 10,912 0

EquityOwner Injections 5,000 5,000 5,000 5,000 Net Income -25 3,851 25,170 39,465 Retained Earnings -25 3,826 28,996

Total Equity 4,975 8,826 33,996 73,460

Total Lia and Equity 34,984 29,714 44,908 73,460

Acc Depreciation