FINANCIAL ASSUMPTIONS

1 Initial Capital P25,000

75,000 contributed by each partners
2 Annual working days 288 days
3 Accounting reporting period calendar year
4 Increase in production 5% based on the five-year operation
5 Increase in cost of purchases 2.70% based on average inflation rate
6 Increase in average sales 2.70% per year
1.00% cash discount
7 Increase in labor rate per day 2.70% annually
Employees will be paid every 15th & each month
30th
8 Employee benefits SSS, PhilHealth, Pag-ibig and fringe benefit
9 Increase in utilities expense 2.70%
10 Repairs and maintenance 3,000 annually
expense
Repairs and maintenance 2.70% inflation rate
expense is based on
11 Property, plant and equipment no additional machinery purchased for first
purchases five years of operation
Depreciation method straight-line method
12 Advertising expense will increase based on inflation rate
13 Interest given to partners 15% based on beginning capital
Withdrawals allowed to owner 50% of the share in operating income
14 Income tax expense No income tax expense
15 Average inflation rate 2.70% per year
 TOTAL PROJECT COSTS
Table 5.1
Total Project Cost - for Two Months
Pre Operating Expenses
Taxes and Licenses 8,125.00
Rent Security Deposit 20,000.00 28,125.00
Fixed Assets
Office Furniture and Fixture 20,699.00
Office Supplies 4,122.75
Factory Furniture 5095.00
Leasehold Improvements 2150.00
Factory Equipment 25,185.50 57,252.25
Working Capital for Two Months
Direct Materials 22,366.67
Direct Labor 25,632.00
Overhead
Indirect Materials 41,891.67
Factory Tools and Supplies 181.67
Rent Expense – Factory 16,000.00
Utilities Expense – Factory 3,520.00
Maintenance Expense – Factory 2,258.83 111,850.84
Other Expenses:
SSS,EC, Philhealth Contribution 2,100.00
Maintenance Expense Office 564.71
Advertising Expense 3,583.33
Salary of the Bookkeeper 3,600.00
Utilities Expense Office 1,760.00
Rent Expense Office 8,000.00 19608.04
Total 216,836.13
Cash on Hand 8,163.87
Total Project Costs 225,000.00
 SCHEDULES
Leasehold Improvement

Particulars Specification Quantity Unit Cost Total Cost

Paint Boysen 4 liters 500 2,000
Paintbrush 5 inches brush 2 pieces 50 100
Plywood 1200mm x 2440(4’ x 6’) 10 pieces 75 750
Nails ¾’ x 18g 75 pieces 2 150
Hammer wood 1 piece 150 150
Saw wood 1 piece 400 400
Labor carpenters 2 workers 300 600
Total 4,150

Direct Materials

Particulars Specifications Quantity/Annual Unit Cost Total Cost

Production
Fresh Milk Bottled 1560 bottles 70.00 109,200.00
Banana lakatan 12 sacks 1,500.00 18,000.00
Organic Probiotics fermented 10 liters 700.00 7,000.00
Total 134,200.00

Rent Expense

Utilities Monthly Consumption Cost (Annually)

Building 2500.00 30000.00
Total 30000.00

Utilities Expense

Utilities Monthly Consumption Cost (annually)

Electricity Bill 1,400.00 16,800.00
Water Bill 800.00 9,600.00
Telephone (PLDT) 599.00 7,188.00
Total 33,588.00
 Maintenance Supplies

Particulars Specification Quantity Unit Cost Total Cost

Fire Extinguisher 10 pounds 2 pcs. 1, 2,999.50
499.75
First aid Kit (Class A) 1 pc. 749.75 749.75
Garbage can 10”H x 6” D 10 pcs. 100.00 1,000.00
Broom Standard size 5 pcs. 109.75 548.75
Dust pan 8 x 9 inches 5 pcs. 59.00 295.00
Rug Medium 21 pcs. 3 for 383.25
54.75
Mop Standard size 5 pcs. 169.00 845.00
Hand Soap 100 grams 240 pcs. 20.00 4,800.00
Gloves Standard size 20 pcs. 13. 75 275.00
Garbage bag 1m x 2m 100 pcs. 9.75 975.00
Sponge Standard size 100 pcs. 32.00 320.00
Apron Standard size 20 pcs. 187.50 3,750.00
Total Cost 16,941.25

Labor Requirement

Employees Daily Monthly Annually

Worker 1 267.00 6408.00 76,896.00
Worker 2 267.00 6,408.00 76896.00
Total 153792.00

Office Furniture and Fixture

Particulars Specification Quantity Unit Cost Total Cost

Office Chairs Monoblock 3 pcs. 165.00 495.00
Office Table 33”x27” 1 pc. 1550.00 1550.00
Stand Fan Plastic/16”/60watts 1 pc. 750.00 750.00
File drawer Metal 2 pcs. 1100.00 2200.00
Wall clock Plastic/Square 1 pc. 100.00 100.00
Total 5095.00
 Office Equipment

Particulars Total Cost

Telephone 699.00
Computer 15,000
Printer 5000
Total 20,699.00

Indirect Materials

Particulars Specifications Quantity/Annual Unit Cost Annual Cost

Production
Bottle Glass 29000 pieces 12.00 348000.00
Shrink wrap transparent plastic 2420 pieces 8.00 19328.00
Label Sticker 29000 pieces 0.50 14500.00
Total 381,828.00

Factory Tools and Supplies

Particulars Specifications Quantity Unit Cost Total Cost

Weighing Scale plastic 1 piece 210.00 210.00
Spatula silicone 2 pieces 189.00 378.00
Measuring spoon & plastic material 2 pieces 232.00 464.00
cup
Knife stainless 1 piece 200.00 200.00
Potholder set 50 pieces 1.25 62.50
Chopping Board Wood 16 × 2 × 26 2 pieces 75.00 150.00
Strainer plastic 2 pieces 28.00 56.00
Blender 1.5L glass jar 2 pieces 960.00 1920.00
Beverage Cooler Anti-Frost 1 piece 21745.00 21745.00
Total Cost 1520.50

Factory Furniture and Fixtures

Particulars Specifications Quantity Unit Cost Total Cost

Working Table 33”x27” 1 pieces 1500.00 1500.00
Working Chair monoblock 4 pieces 195.75 780.00
Ceiling Fan 16" 1 piece 1775.00 1775.00
Total Cost 4055.00
 Office Supplies

Particulars Specifications Quantity Unit Cost Total Cost

Calculator 12 Digits 2 pieces 150.00 300.00
Columnar book 70 sheets 2 pieces 21.00 42.00
Ballpen Black (0.5mm) 30 pieces 4.75 142.50
Business Receipts Standard Booklet 50 pieces 40.00 2000.00
Stapler 3.8×4.8×3.4”/Metal 2 pieces 60.00 120.00
Puncher Two-hole puncher 3 pieces 58.75 176.25
Fastener small 1 box 9.00 9.00
Staple wire Standard size 50 boxes 6.00 30.00
Folder short 50 pieces 5.00 250.00
Folder long 50 pieces 6.50 325.00
Ruler 12 inches 4 pieces 13.00 52.00
Paper clip Small/50 pcs per 2 packs 9.50 19.00
pack
Envelope short 50 pieces 1.50 75.00
Scotch tape 18m×25m 12 pieces 21.00 252.00
Bondpaper short 1 ream 115.00 115.00
Bondpaper long 1 ream 215.00 215.00
Total 4122.25

Legal Fees
Particulars Amount
VAT Registration 500.00
SEC Registration 500.00
BIR Registration 500.00
Zoning Fee 1400.00
Annual Inspection Fee 650.00
Fire Inspection Fee 549.00
Medical Fee 150.00
Garbage Fee 1000.00
Sanitary Fee 200.00
Mayor's Permit 250.00
Business Tax 100.00
Occupational Tax 300.00
Community Tax Clearance 596.00
Business Plate 130.00
BMBE 1000.00
Nutritional Analysis Fee 300.00
Taxes and Licenses Expense 8125.00
 Partner’s Contribution

Partner Amount
Claveria, Frieda Lyn A. 75,000
Cuevas, Joebher 75,000
Reyes, Ravin 75,000
Total 225,000

Compensation Schedule (2017)

Position Daily Monthly Annually

Manager 350.00 9,100.00 109200.00
Bookkeeper (part- 1,800.00 21600.00
time)
Workers (2) 267.00 6,142.00 83304.00
Total 214104.00
 FINANCIAL STATEMENTS
FJR ENTERPRISE
Projected Income Statement
For the year ended December 2018-2022
Particulars 2018 2019 2020 2021 2022
Net Sales
898,071.32 973,616.72 1,043,718.74 1,121,408.44 1,208,972.37
Less: Cost of Goods
Sold 572,749.56 620,929.03 665,636.95 715,183.95 771,028.30
Gross Profit
325,321.76 352,687.69 378,081.79 406,224.49 437,944.07
Less: Operating
Expense
Selling
Expense 67,196.43 69,509.93 71,904.57 74,383.23 76,948.91

Administrative 184,823.53 191,507.41 204,539.27 218,618.71 233,637.52

Expense
Total Operating
Expenses 252,019.96 261,017.34 276,443.85 293,001.94 310,586.43
Total
73,301.80 91,670.35 101,637.94 113,222.55 127,357.64
Less: Loss on
Spoilage 5,131.84 5,563.52 5,964.11 6,408.05 6,908.41
Net Income
68,169.96 86,106.83 95,673.83 106,814.50 120,449.23
 FJR RNTERPRISE
Projected Statement of Financial Position
For the year ended December 2018-2022
2018 2019 2020 2021 2022
ASSETS
Currents Assets
Cash
185,492.57 239,194.00 297,509.15 361,458.02 432,306.00
Prepaid Rent
20,000.00 20,000.00 20,000.00 20,000.00 20,000.00
Inventory
11,982.14 12,920.94 13,933.30 15,024.97 16,221.96
Total Current Assets
217,474.71 272,114.94 331,442.45 396,482.99 468,527.96
Non Current Assets
Property, Plant and
Equip. 44,027.60 33,020.70 22,013.80 11,006.90 -
Leasehold
Improvement, net 1,679.69 1,439.73 1,199.78 959.82 719.87
Total Non Current
Assets 45,707.29 34,460.43 23,213.58 11,966.72 719.87

TOTAL ASSETS
263,182.00 306,575.37 354,656.03 408,449.71 469,247.83

LIABILITIES
&PARTNER'S EQUITY
Current Liabilities
Accounts Payable
1,997.02 2,153.49 2,322.22 2,504.16 2,703.66
SSS, Philhealth, EC
Payable 2,100.00 2,283.50 2,358.50 2,563.00 2,937.00
Total Current
Liabilities 4,097.02 4,436.99 4,680.72 5,067.16 5,640.66
Partner's Equity
Partner 1, Capital 86,361.66
100,712.80 116,658.44 134,460.85 154,535.72
Partner 2, Capital 86,361.66
100,712.80 116,658.44 134,460.85 154,535.72
Partner 3, Capital 86,361.66
100,712.80 116,658.44 134,460.85 154,535.72
Total Partner's 259,084.98
 Equity 302,138.40 349,975.32 403,382.55 463,607.16

TOTAL LIABILITIES & 263,182.00

EQUITY 306,575.39 354,656.04 408,449.71 469,247.82

FJR ENTERPRISE
Projected Statement of Changes in Partners Equity
For the year ended December 2018-2022
2018 2019 2020 2021 2022
Partner 1, Capital
Capital balance
beginning 75,000.00 86,361.66 100,712.79 116,658.43 134,460.84
Add: Share in Operating
Income 22,723.32 28,702.27 31,891.28 35,604.83 40,149.74
Less: Withdrawal
11,361.66 14,351.14 15,945.64 17,802.42 20,074.87
Partner 1, Capital
Ending 86,361.66 100,712.79 116,658.43 134,460.84 154,535.71

Partner 2, Capital
Capital balance
beginning 75,000.00 86,361.66 100,712.79 116,658.43 134,460.84
Add: Share in Operating
Income 22,723.32 28,702.27 31,891.28 35,604.83 40,149.74
Less: Withdrawal
11,361.66 14,351.14 15,945.64 17,802.42 20,074.87
Partner 2, Capital
Ending 86,361.66 100,712.79 116,658.43 134,460.84 154,535.71

Partner 3, Capital
Capital balance
beginning 75,000.00 86,361.66 100,712.79 116,658.43 134,460.84
Add: Share in Operating
Income 22,723.32 28,702.27 31,891.28 35,604.83 40,149.74
Less: Withdrawal
11,361.66 14,351.14 15,945.64 17,802.42 20,074.87
Partner 3, Capital
Ending 86,361.66 100,712.79 116,658.43 134,460.84 154,535.71
 FJR ENTERPRISE
Projected Statement Of Cash Flows
For the year ended December 2018-2022
2018 2019 2020 2021 2022
Cash Flow from
Operating Activities
Net Income
68,169.96 86,106.82 95,673.84 106,814.50 120,449.23
Add(Deduct)
Depreciation Expense
11,246.86 11,246.86 11,246.86 11,246.86 11,246.86
Increase in Prepaid Rent
(20,000.00)
Increase in Merchandise
Inventory (11,982.14) (938.80) (1,012.36) (1,091.67) (1,196.99)
Increase in Accounts
Payable 1,997.02 156.47 168.73 181.95 199.50
Increase in SSS,
Philhealth, EC Payable 2,100.00 183.50 75.00 204.50 374.00
Net Cash Flow 51,531.70 96,754.84 106,152.06 117,356.13 131,072.59

Cash Flow from Investing

Activity
Acquisition of Fixed Asset
55,034.50
Acquisition of Leasehold 1,919.64
Improvement
Net Cash Used 56,954.14

Cash Flow from

Financing
Initial Investment
225,000.00
Less: Withdrawal 34,084.98 43,053.41 47,836.92 53,407.25 60,224.61
Net Cash Provided
190,915.02 (43,053.41) (47,836.92) (53,407.25) (60,224.61)

58,315.14 63,948.88
Net Increase in Cash
185,492.57 53,701.43 58,315.14 63,948.88 70,847.98
Cash Balance Beg 185,492.57 239,194.00 297,509.15 361,458.02
Cash Balance Ending 185,492.57 239,194.00 297,509.15 361,458.02 432,306.00
 RATIOS
Table 5.6
Current Ratio
Year Current Asset Current Liabilities Ratio
2018 222,056.71 4,097.02 54.20
2019 279,789.88 4,436.99 63.06
2020 342,567.97 4,680.72 73.19
2021 411,455.49 5,067.16 81.20
2022 487,794.19 5,640.66 86.48

Table 5.7
Quick Asset Ratio
Year Quick Assets Current Liabilities Quick Ratio
2018 190074.57 4097.02 46.39
2019 246868.93 4436.99 55.64
2020 308634.67 4680.72 65.94
2021 376430.52 5067.16 74.29
2022 451572.23 5640.66 80.06

Table 5.8
Working Capital
Year Current Assets Current Liabilities Working Capital
2018 222056.71 4097.02 217959.69
2019 279789.88 4436.99 275352.89
2020 342567.97 4680.72 337887.25
2021 411455.49 5067.16 406388.33
2022 487794.19 5640.66 482153.53

Table 5.9
Asset Turnover
Year Net Sales Average Assets Ratio
2018 1,016,103.55 267,764.00 3.79
2019 1,101,577.77 291,007.15 3.79
2020 1,180,893.20 340,015.93 3.47
2021 1,268,793.55 394,601.88 3.22
2022 1,367,865.88 455,968.13 3.00
 Table 5.10
Gross Profit Margin
Year Gross Profit Net Sales Ratio
2018 334485.75 1,016,103.55 33.00%
2019 362622.55 1,101,577.77 33.00%
2020 388731.98 1,180,893.20 33.00%
2021 417667.43 1,268,793.55 33.00%
2022 450280.53 1,367,865.88 33.00%

Table 5.11
Net Profit Margin
Table 5.9
Year Operating Profit
Asset Turnover Net Sales Ratios
2018 77333.95 1016103.55 8.00%
2019 92292.68 1101577.77 8.00%
2020 102575.03 1180893.20 9.00%
2021 114508.44 1268793.55 9.00%
2022 129036.68 1367865.88 9.00%

Table 5.12
Rate of Return on Asset (ROA)
Year Operating Profit Total Assets Ratio
2018 77,333.95 267,764.00 29.00%
2019 92,292.68 291,007.15 32.00%
2020 102,575.03 340,015.93 30.00%
2021 114,508.44 394,601.88 29.00%
2022 129,036.68 455,968.13 28.00%

Table 5.13
Return on Equity
Year Net Income Ave. Partner's Equity Ratio
2018 77333.95 263,666.98 29.00%
2019 92292.68 286,740.15 32.00%
2020 102575.03 335,457.08 31.00%
2021 114508.44 389,727.94 29.00%
2022 129036.68 450,614.22 29.00%
 Table 5.14
Debt Ratio
Year Total Liabilities Total Assets Ratio
2018 4097.02 267764.00 2.00%
2019 4436.99 314250.31 1%
2020 4680.72 365781.55 1%
2021 5067.16 423422.22 1%
2022 5640.66 488514.05 1%

Table 5.15
Equity Ratio
Year Total Partner's Equity Total Assets Ratio
2018 4097.02 267764.00 2.00%
2019 4436.99 314250.31 1.00%
2020 4680.72 365781.55 1.00%
2021 5067.16 423422.22 1.00%
2022 5640.66 488514.05 1.00%

Table 5.16
Debt to Equity Ratio
Year Total Liabilities Total Partner's Equity Ratio
2018 4,097.02 263,666.98 2.00%
2019 4,436.99 309,813.32 1.00%
2020 4,680.72 361,100.83 1.00%
2021 5,067.16 418,355.05 1.00%
2022 5,640.66 482,873.39 1.00%

Table 5.17
Break Even Volume Analysis
Year Fixed Cost Cm/Unit Breakeven Point
2018 236541.98 18.08 13,083.83
2019 244286.65 18.76 13,020.34
2020 258022.11 18.92 13,638.65
2021 274419.18 19.92 14,280.29
2022 294260.68 19.69 14,947.92
 Table 5.18
Break-Even Sales (Peso) Analysis
Year Fixed Cost Cm% Breakeven Point
2018 236,541.98 51.00% 463,935.22
2019 244,286.65 51.00% 476,686.26
2020 258,022.11 51.00% 506,341.42
2021 274,419.18 51.00% 540,413.84
2022 294,260.68 51.00% 580,101.17

Table 5.19
Margin of Safety
Year Sales BEP Peso Sales Margin of Safety
2018 1,016,103.55 463,935.22 552,168.33
2019 1,101,577.77 476,686.26 624,891.51
2020 1,180,893.20 506,341.42 674,551.78
2021 1,268,793.55 540,413.84 728,379.71
2022 1,367,865.88 580,101.17 787,764.71

Table 5.20
Margin of Safety Ratio
Year MOS Sales Margin of Safety
2018 552168.33 1016103.55 54.34%
2019 624891.51 1101577.77 56.73%
2020 674551.78 1180893.20 57.12%
2021 728379.71 1268793.55 57.41%
2022 787764.71 1367865.88 57.59%

Table 5.21
Payback Period
Year Initial Investment Annual Cash Flow Cash to Date Payback Period
2018 225000.00 88,580.81 88,580.81 1.00
2019 225000.00 103,539.54 192,120.35 1.00
2020 225000.00 113,821.88 305,942.23 0.29
2021 225000.00 125,755.30 431,697.53 0.29
2022 225000.00 140,283.54 571,981.06 0.25
2.83