V.

Financial Plan

1| SHIOK
 The financial aspect of the project feasibility study quantifies the

results of the marketing, technical, management, taxation and legal phase

of the project study and expresses in peso terms the possible outcome of

operating the project.

This part is composed of Total Project Cost, Sources of Financing,

five-year Projected Financial Statement: Projected Cash Flow Statement,

Income Statement and Projected Balance Sheet, Profitability Indices

(which include the computation of ROI, Payback Period, Sales Ratio,

Break-even Point), and the List of Assumptions Used.

A. Total Projected Cost

The estimated total projected cost is Php120, 000.00. The

amount will cover the three (3) items of capital requirement: Fixed

Capital Assets, Pre-Operating Expenses and Working Capital.

Table 33

2| SHIOK
 TOTAL PROJECTED COST
Fixed Capital Asset
Machineries and Equipment 16,640.00
Kitchen Utensils 5,156.00
Office Equipment 6,720.00
Cleaning Tools 1,295.00
Total 29,811.00
Pre-Operating Expense
Advertising Expense 1,500.00
Taxes and License 5,880.00
Total 7,380.00
Working Capital
Cash 36,619.00
Packaging Supplies 515.00
Raw Materials 16,200.00
Office Equipment 6,720.00
Office Supplies 255.00
Prepaid Rent 22,500.00
Total 82,809.00
TOTAL PROJECT COST _120,000.00

B. Sources of Financing

The financial source for the business will be contributed by the

partners equally. The partners will contribute a total of Php 120,000.00 as

presented below.

Table 34

Partner’s Contribution

Initial Share in
Partners
3| SHIOK
 Investment Profit / Loss
Candalla, El-vie 30,000.00 25%
Reyes, Julienne V. 30,000.00 25%
Yamat, Shalina Mae 30,000.00 25%

S.
Salcedo, Jam 30,000.00 25%

Weelaine
TOTAL Php 120,000.00 100%

C. Projected Financial Statement

The Projected Cash Flow Statement below shows the inflows and

outflows of cash for the five-year period as presented.

1. Projected Cash Flow Statement

Table 35
PROJECTED CASH FLOW STATEMENT

Year Year 2 Year 3 Year 4 Year 5

1
Cash Flow from Operating
Activities
Net Profit 245,514.08 338,659.70 451,901.01 582,082.13 732,339.03
Add: Depreciation 0 2,375.00 2,375.00 2,375.00 2,375.00
expenses
Less: Prepaid rent 45,000 0.00 0.00 0.00 0.00
Net Cash provided by 200,514.08 341,034.70 454,276.01 584,457.13 734,714.03
Operating Activities

Cash Flow from Investment

Activities
Purchase of 16,640.00 0.00 0.00 0.00 0.00
Machineries & Equipment
Purchase of Furniture 0.00 0.00 0.00 0.00

4| SHIOK
 Purchase of Vehicle 26,315.00
Leasehold Improvements 4,680.00 0.00 0.00 0.00 0.00
Net Cash from investment 47,635.00 0.00 0.00 0.00 0.00
activities

Cash Flow from Financing

Activities
Proceeds from Partner 120,000.00
Investment in 16,235.31 155.00 249.45 347.60
Marketable Securities
Withdrawals of 49,102.82 135,463.88 180,760.40 116,416.43 219,701.71
Partners
Net Cash from Financing 54,661.87 (135,618.88) (181,009.85) (116,764.03) (219,701.71)
Activities

Net Cash 207,540.96 205,415.82 273,266.16 467,693.10 515,012.32

Cash at the Beginning of 0.00 207,540.96 412,956.78 686,222.93 1,153,916.04
Period
Cash at the End of Period 207,540.96 412,956.78 686,222.93 1,153,916.04 1,668,928.35

2. Projected Income Statement

This shows the business performance of Shiok. It illustrates that the

partnership will be profitable from year one to five.

Table 36

INCOME STATEMENT

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5

Sales 1,754,886.31 1,978,914.35 2,231,541.72 2,516,048.93 2,837,664.41

Less: Cost of Sales 696,180.41 772,303.89 838,875.13 912,009.50 992,403.67

5| SHIOK
Gross Profit 1,058,705.91 1,206,610.46 1,392,666.59 1,604,039.43 1,845,260.74

Less: Operating
Expense
Selling Expense 8,375. 7 452.75 7 795.58 8 154.17 8 529.26
00
Administrative 693,596.50 716,534.89 740,529.02 765,626.86 791,879.59
Expense
Repair and 6,000.00 6,276.00 6,564.70 6,866.67 7,182.54
maintenance
Total Operating 707,971.50 722,810.89 747,093.72 772,493.53 799,062.13
Expense
Add: Other Income

Income Before Tax 350,734.41 483,799.57 645,572.87 831,545.90 1,046,198.61

Income Taxes 30% 105,220.32 145,139.87 193,671.86 249,463.77 313,859.58

Net Income 245,514.08 338,659.70 451,901.01 582,082.13 732,339.03

3. Projected Balance Sheet

The table below depicts the assets acquires by the business and the

corresponding liabilities at incurred and the partner’s equity for the five-

year period.

Table 37
PROJECTED STATEMENT OF FINANCIAL POSITION
Year 1 Year 2 Year 3 Year 4 Year 5

6| SHIOK
 Assets
Current Assets
Cash 207,540.96 412,956.78 686,222.93 1,153,916.04 1,668,928.35
Marketable Securities 16,235.31 155.00 249.45 347.60 0.00
Prepaid Rent 45,000 45,000 45,000 45,000 45,000
Total Current Assets 293,426.27 483,895.68 758,442.34 1,227,474.21 1,743,436.62
Non-Current Assets
Machineries & 16,640.00 13,312.00 9,984.00 6,656.00 3,328.00
Equipment
Furnitures 0.00 0.00 0.00 0.00 0.00
Vehicle 0.00 0.00 0.00 0.00
Leasehold Improvements 4,680.00 3,744.00 2,808.00 1,872.00 936.00
Total Non-Current Assets 39,155.00 35,711.41 32,305.56 28,939.18 25,614.10
Total Assets 332,581.27 519,607.09 790,747.90 1,256,413.40 1,769,050.71

Liabilities and Owner's Equity

Liabilities
Current Liabilities
Accounts Payable 16,170.00 0.00 0.00 0.00 0.00
Total Liabilities 16,170.00 0.00 0.00 0.00 0.00

Partner's Capital
Partner's Contribution 120,000.00 316,411.27 519,607.09 790,747.69 1,256,413.40
Beginning
Add: Net Income 245,514.08 338,659.70 451,901.01 582,082.13 732,339.03
365,514.08 655,070.97 971,508.10 1,372,829.82 1,988,752.42
Less: Partner's Withdrawals 49,102.82 135,463.88 180,760.40 116,416.43 219,701.71
Total Capital 316,411.27 519,607.09 790,747.69 1,256,413.40 1,769,050.71

Total Liabilities and Owner's 332,581.27 519,607.09 790,747.69 1,256,413.40 1,769,050.71

Equity

Statement of Changes in Equity

7| SHIOK
 Statement of Changes in Equity shows the movements of equity in

addition to accumulated earnings and losses and presents the sources and

outlets of equity.

Table 38

STATEMENT OF CHANGES IN EQUITY

Year 1 Year 2 Year 3 Year 4 Year 5

Beginning Partners Equity 400,000.00 584,135.56 651,867.50 742,247.70 829,560.02

Add: Net Income 245,514.08 338,659.70 451,901.01 582,082.13 732,339.03

Total 645,514.08 922,795.26 1,103,768.51 1,324,329.83 1,561,899.05

Less: Partners Withdrawal 61,378.52 270,927.76 361,520.81 494,769.81 637,134.95

Ending Partners Equity 584,135.56 651,867.50 742,247.70 829,560.02 924,764.10

D. Profitability Indices

1. ROI

The Return on Investment (ROI) is a performance measure used to

evaluate the efficiency of investment.

Table 39

Year 1 Year 2 Year 3 Year 4 Year 5

8| SHIOK
Beginning

Investment
Add: Equity Ending
Total: 365,514.78 458,659.70 573,204.91 702,082.13 852,339.02
Divide by: 2 2 2 2 2
Average Equity 182,757.39 229,329.85 286,602.46 351,041.06 426,169.51
Net Income 245,514.78 338,659.70 453,204.91 582,082.13 732,339.02
Divide: Average 182,757.39 229,329.85 286,602.46 351,041.06 426,169.51

Equity
Return on 1.34 1.48 1.58 1.66 1.72

Investment

2. Payback Period

Payback period refers to the length of time required to recover the

cost of investment.

Table 40

PAYBACK PERIOD
Months Payback Period
Investment 120,000.00
Less: Net Income for 245,514.78 12 5.865227266
Year 1
3. Net Income: Sales Ratio

9| SHIOK
 The ratios reflected below show the efficiency of managing outputs

relative to sales

Table 41

SALES RATIO
Year 1 Year 2 Year 3 Year 4 Year 5
Gross Profit 1,058,706.90 1,206,610.46 1,394,529.30 1,604,039.43 1,845,260.73
Divide by: 1,754,886.3 1,978,914.3 2,231,541.7 2,516,048.9 2,837,664.

Net Sales 1 5 2 3 41
Sales Ratio 60.33% 60.97% 62.49% 63.75% 65.03%

4. Break-even Point

The table below indicates how Shiok uses its resources for which it

will able to provide for its fixed cost.

Table 42

Break-even Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Capacity per Day
94.00 100.00 106.00 113.00 120.00

Number of Days in a 360.00 360.00 360.00 360.00 360.00

Year

Target Supply per 33,840.00 36,000.00 38,160.00 40,680.00 43,200.00

Year

10 | S H I O K
Variable Cost 696,179.41 772,303.89 837,012.41 912,009.50 992,403.68
Divide by: Unit Sales 33,840.00 36,000.00 38,160.00 40,680.00 43,200.00

Variable Cost per Unit 20.57 21.45 21.93 22.42 22.97

Fixed Cost 105,220.62 145,139.87 194,230.68 249,463.77 313,859.58

Variable Cost per Unit 20.57 21.45 21.93 22.42 22.97

Break-even in terms of 5,115 6,766 8,855 11,127 13,663

Unit Sales

E. List of Assumptions Used

Assumptions used by the proponents are the following:

 Sales – Annual increase of 6% is based on the GDP growth rate.

 Price –Annual increase in price is based on the GDP growth rate of 6%.
 Cost of Raw Materials – Annual increase of raw materials is based on the

inflation rate of 4.6%.

 Depreciation Method – used for Machineries and Equipment
a) Machineries and Equipment has its 5 years useful life
 There will be a 4.6% annual increase based on inflation on the following :
a) Utilities expense
b) Salaries
c) Taxes and licenses
d) Advertising expense
e) Repairs and Maintenance
f) Office Supplies
 The proponents agreed to have their annual drawings of 25% in

circumstance of recognizing the net income every year.

11 | S H I O K
  Interest Income on marketable securities is based on 2% interest rate per

annum.

F. Schedules

1. Projected Sales

Table 43

Year 1

Product Offered Price Percentage Allocation Daily Sales

(PhP) Allocation Target (PhP)
for Target Market
Market
Fried Lumpia 25.00 73% 150 3,761.65
Steamed Lumpia 20.00 27% 56 1,113.04
Total Daily Sales 100% 206 4,874.68
Projected Yearly Sales 1,754,886.31

Table 44

Year 2

Product Offered Price Percentage Allocation Daily Sales

(PhP)
(PhP) Allocation for Target
Target Market Market
Fried Lumpia 27 73% 160 4,241.86
Steamed Lumpia 21 27% 59 1,255.13
Total Daily Sales 100% 219 5,496.98
Projected Yearly Sales 1,978,914.35
12 | S H I O K
 Table 45

Year 3

Product Offered Price Percentage Allocation Daily Sales

(PhP)
(PhP) Allocation Target Market
for Target
Market
Fried Lumpia 28 73% 170 4,783.37
Steamed Lumpia 22 27% 63 1,415.35
Total Daily Sales 100% 233 6,198.73
Projected Yearly 2,231,541.72
Sales

Table 46

Year 4

Product Offered Price Percentage Allocation Daily Sales

(PhP)
(PhP) Allocation Target Market
for Target
Market
Fried Lumpia 30 73% 181 5,394.02
Steamed Lumpia 24 27% 67 1,595.01
Total Daily Sales 100% 248 6,989.02
Projected Yearly 2,516,048.93
Sales

13 | S H I O K
 Table 47

Year 5

Product Offered Price Percentage Allocation Daily Sales

(PhP)
(PhP) Allocation Target Market
for Target
Market
Fried Lumpia 32 73% 193 6,082.61
Steamed Lumpia 25 27% 71 1,799.79
Total Daily Sales 100% 264 7,882.40
Projected Yearly 2,837,664.41
Sales

2. Projected Sales Volume

Projected Sales

Table 48
Product Offered Price (PhP) Percentage Allocation Daily Sales
Allocation for Target (PhP)
Target Market Market
Fried Lumpia 15.00 73% 150 2,256.99
Steamed Lumpia 10.00 27% 56 556.52
Total Daily Sales 100% 206 2,813.51
Projected Yearly Sales 1,012,862.50

Year 2
Product Offered Price (PhP) Percentage Allocation Daily Sales
Allocation for Target (PhP)
Target Market Market
Fried Lumpia 16 73% 160 2,545.12
Steamed Lumpia 11 27% 59 627.56
Total Daily Sales 100% 219 3,172.68
Projected Yearly Sales 1,142,164.10

14 | S H I O K
year 3
Product Offered Price (PhP) Percentage Allocation Daily Sales
Allocation for Target (PhP)
Target Market Market
Fried Lumpia 17 73% 170 2,870.02
Steamed Lumpia 11 27% 63 707.68
Total Daily Sales 100% 233 3,577.70
Projected Yearly Sales 1,287,972.28

year 4
Product Offered Price (PhP) Percentage Allocation Daily Sales
Allocation for Target (PhP)
Target Market Market
Fried Lumpia 18 73% 181 3,236.41
Steamed Lumpia 12 27% 67 797.50
Total Daily Sales 100% 248 4,033.91
Projected Yearly Sales 1,452,209.05

year 5
Product Offered Price (PhP) Percentage Allocation Daily Sales
Allocation for Target (PhP)
Target Market Market
Fried Lumpia 19 73% 193 3,649.57
Steamed Lumpia 13 27% 71 899.89
Total Daily Sales 100% 264 4,549.46
Projected Yearly Sales 1,637,806.31

3. Fixed Capital Investment

15 | S H I O K
 Table 49
Items Year 1 Year 2 Year 3 Year 4 Year 5
Cost of Goods Sold 696,179.41 772,303.89 837,012.41 912,009.50 992,403.68
Fixed cost
Office salaries 249,600.00 254,592.00 259,683.84 264,877.52 270,175.07
Employer's Contribution 249,600.00 254,592.00 259,683.84 264,877.52 270,175.07
13th Month Pay 20,800.00 21,216.00 21,640.32 22,073.13 22,514.59
Depreciation-Machineries and 9,615.00 9,615.00 9,615.00 9,615.00 9,615.00

Equipment
Depreciation-Furniture 2,096.00 2,096.00 2,096.00 2,096.00 2,096.00
Depreciation - Leasehold 55,500.00 55,500.00 55,500.00 55,500.00 55,500.00

Improvement
Taxes and Licenses 6,660.00 6,660.00 6,660.00 6,660.00 6,660.00
Rent Expense 132,000.00 132,000.00 135,960.00 135,960.00 140,038.80
Utilities Expense 48,000.00 49,440.00 50,923.20 52,450.90 54,024.42
Advertising Expense 2,020 2,081 2,143 2,207 2,274
Total Fixed Cost 775,891.00 787,791.60 803,905.22 816,317.36 833,072.47

4. Projected Cost of Goods Sold

Table 50

SCHEDULE FOR COST OF GOOD SOLD

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5

Direct Materials:

Beginning 0.00 16,200.00 16,945.20 17,724.68 18,540.01

Inventory

16 | S H I O K
Add: Purchases 417,865.41 464,986.40 707,974.33 575,768.52 640,695.61

Total 417,865.41 481,186.40 724,919.53 593,493.20 659,235.62

Less:

Ending Inventory 16,200.00 16,945.20 17,724.68 18,540.01 19,392.86

Raw Materials Used 401,665.41 464,241.20 707,194.85 574,953.18 639,842.77

Packaging Supply 515 538.69 563.47 589.4 616.5

Supplies

Direct Labor 294,000.00 307524 321670.104 336466.9288 351944.4075

Cost of Good Sold 696,180.41 772,303.89 1,029,428.42 912,009.50 992,403.67

5. Schedule of Materials Purchases

Table 51

Total Production Cost Schedule

Year 1
Product offered Cost Allocation Production Production Production Cost
per Target Cost per Day Cost per per Year
Unit Month
Lumpianeeza 8 150 1,160.74 34,822.12 417,865.41
17 | S H I O K
 1, 34, 417,86
Total 150 160.74 822.12 5.41

Year 2
Product offered Cost Allocation Production Production Production Cost
per Target Cost per Day Cost per per Year
Unit Month
Lumpianeeza 8 160 1,291.63 38,748.87 464,986.40
1, 38, 464,98
Total 160 291.63 748.87 6.40

Year 3
Product offered Cost Allocation Production Production Production Cost
per Target Cost per Day Cost per per Year
Unit Month
Lumpianeeza 8 233 1,966.60 58,997.86 707,974.33
Total 233 5 632.84 58,997.86 707,974.33

Year 4

Product offered Cost Allocation Production Production Production Cost

per Target Cost per Day Cost per per Year
Unit Month
Lumpianeeza 9 181 1,599.36 47,980.71 575,768.52
Total 181 5 632.84 47,980.71 575,768.52

Year 5
Product offered Cost Allocation Production Production Production Cost
per Target Cost per Day Cost per per Year
Unit Month
Lumpianeeza 9 193 1,779.71 53,391.30 640,695.61
Total 192.72 5 632.84 53,391.30 640,695.61

7. Projected Administrative and Selling Expenses

Table 52

ADMINISTRATIVE EXPENSE
Year 1 Year 2 Year 3 Year 4 Year 5
Rent Expense 90,000.00 90,000.00 90,000.00 90,000.00 90,000.00
Utilities Expense 72,000.00 75,312.00 78,776.35 82,400.06 86,190.47
18 | S H I O K
Advertising Expense 1,500.00 1,569.00 1,641.17 1,716.67 1,795.63
Salaries Expense 294,000.00 307,524.00 321,670.10 336,466.93 351,944.41
13th month Pay 24,500.00 25,627.00 26,805.84 28,038.91 29,328.70
Employers 27,533 27,533 27,533 27,533 27,533
contribution
Taxes and Licenses 5,880.00 5,880.00 5,880.00 5,880.00 5,880.00
Depreciation 2,375.00 2,375.00 2,375.00 2,375.00 2,375.00
Expense - Equipment
TOTAL 517,787.80 535,819.80 554,681.27 574,410.37 595,047.01

19 | S H I O K