An acquisition finance calculator from Frostbridge Business Capital in Wooster, Ohio. It shows illustrative arithmetic for the financed part of a business purchase; partners set actual rates and terms.
Small Business Acquisition Loan Calculator: How Wooster, OH Cafe Owners Use It
A cafe owner buying a second shop from its founder starts with the price, subtracts the cash they will put down and any part the seller will carry as a note, and enters the rest as the amount. The seller note has its own payment, which should be added to the result.
Illustration only, invented figures: $400,000 financed at an annual rate of 9% over 120 months gives a payment of about $5,067 and about $208,044 in total interest.
Reading Business Acquisition Finance Calculator Results as One of the Wooster, OH Grocers
A grocer buying a store should add the opening inventory and any equipment replacements to the picture. If inventory is financed separately, its payment sits beside this one. Read the result against the store's cash flow after the owner's pay, not against revenue.
Reading Business Acquisition Finance Calculator Results as One of the Wooster, OH Retailers
A retailer comparing two terms will see the trade-off: a longer term lowers the monthly payment and raises total interest. Run both and look at the difference in total interest in dollars before choosing.
Reading Business Acquisition Finance Calculator Results as One of the Wooster, OH Contractors
A contractor buying another firm should include the vans and equipment that come with it, and check whether any existing equipment loans transfer or must be paid off at closing. Payoffs raise the amount financed.
Costs this acquisition calculator leaves out
Fees, closing costs, a seller note, working capital after closing and any real estate are not included. Partners set actual rates and terms. The article on buying an existing firm and the term loan page cover the rest of an acquisition.
From the calculator result to a request
Once the payment looks workable, a funding request needs the documents behind it: the letter of intent or purchase agreement, the seller's last two or three years of returns, a list of what is included in the sale, and the buyer's own financial statement and down payment source. A partner will compare the payment against the business's cash flow after the new owner's pay.
If the payment only works at the longest term, test what happens if revenue dips for a few months. A purchase that leaves no cushion is a hard one for any partner to fund.
Seller notes, earn-outs and the amount financed
Many small business sales include a seller note, where the seller is paid part of the price over time. Some include an earn-out tied to future results. Both lower the amount a partner finances, but both are still payments the business must make. Add the seller note's payment to the calculator's result to see the full monthly cost.
A partner may require the seller note to be subordinated, meaning it is paid only after the partner's loan payments are current.
Cash needs in the weeks after closing a purchase
A new owner often needs cash right after closing: payroll in the first weeks, supplier deposits that the seller's accounts did not cover, and small repairs. Budget that separately. The working capital page covers sizing a gap.
By Frostbridge Business Capital · Updated