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1.7 Financial Aspect
1.7 Financial Aspect
7 FINANCIAL ASPECT
Based on the material balance, the total amount of coconut sugar that will be
produced per batch is 272.51 kg. There will be a total of 2076 batches of production per
year. Therefore, the total amount of coconut sugar that will be produced per year is
565,730.76 kg. The company’s selling price of coconut sugar per kilogram is Php 200.00.
Multiplying the total number of kilograms of coconut sugar that will be produced per year
to the selling price of one kilogram, the annual sales would be Php 113,146,152.00. The
projected financial analysis of the company is summarized in the tables below. All cost are
in Php.
51
Table 1.7.3. Summary of the Processing Equipment Cost.
INSTALLATION
EQUIPMENT QUANTITY COST SUBTOTAL
COST
Open Mixing
1.00 557,277.22 0.00 557,277.22
Tank
Mixer 1.00 1,187,026.65 0.00 1,187,026.65
Screw
Conveyor with 1.00 105,882.67 0.00 105,882.67
Hopper
Vibrating
1.00 121,371.32 0.00 121,371.32
Screen
Packaging
1.00 1,086,873.73 0.00 1,086,873.73
Equipment
Contingencies 152,921.58
TOTAL 3,058,431.59
PARAMETER SUBTOTAL
Electricity Php 10.00 per kWH 182,500.00
Fuel Php 1650.00 per vehicle month 19,800.00
Packaging Material Php 5.76 per piece 3,456,000.00
TOTAL 3,658,300.00
52
Table 1.7.7. Summary of the Administrative Building Cost.
53
Table 1.7.9. Summary of Administrative Vehicle/s.
PARAMETER COST
Fuel for L300 Van 39,600.00
Water and Electricity Cost 200,000.00
TOTAL 239,600.00
54
Table 1.7.11. Labor Cost Summary.
51
Table 1.7.12. Management Cost Summary.
52
Table 1.7.13. Summary of the Processing Repairs and Maintenance.
53
Table 1.7.14. Continuation
54
Table 1.7.15. Continuation
55
Table 1.7.16. Administrative Repairs and Maintenance
56
Table 1.7.17. Continuation
57
Table 1.7.18. Continuation
58
Table 1.7.19. Summary of the Processing Depreciation Schedule.
DEPRECIATION
SERVICE ACQUISITION
PROCESSING YEAR 1 YEAR 2 YEAR 3 YEAR 4
LIFE COST
Building 25.00 2,578,400.00 92,822.40 92,822.40 92,822.40 92,822.40
Equipment 15.00 3,211,353.17 192,681.19 192,681.19 192,681.19 192,681.19
Minor Equipment 5.00 81,000.00 14,580.00 14,580.00 14,580.00 14,580.00
Vehicles 15.00 1,690,000.00 101,400.00 101,400.00 101,400.00 101,400.00
Depreciation cost per
401,483.59 401,483.59 401,483.59 401,483.59
year
59
Table 1.7.20. Continuation
DEPRECIATION
PROCESSING YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10
Building 92,822.40 92,822.40 92,822.40 92,822.40 92,822.40 92,822.40
Equipment 192,681.19 192,681.19 192,681.19 192,681.19 192,681.19 192,681.19
Minor Equipment 14,580.00 14,580.00 14,580.00 14,580.00 14,580.00 14,580.00
Vehicles 101,400.00 101,400.00 101,400.00 101,400.00 101,400.00 101,400.00
Depreciation cost per
401,483.59 401,483.59 401,483.59 401,483.59 401,483.59 401,483.59
year
60
Table 1.7.21. Continuation
DEPRECIATION
PROCESSING YEAR 11 YEAR 12 YEAR 13 YEAR 14 YEAR 15
Building 92,822.40 92,822.40 92,822.40 92,822.40 92,822.40
Equipment 192,681.19 192,681.19 192,681.19 192,681.19 192,681.19
Minor Equipment 14,580.00 14,580.00 14,580.00 14,580.00 14,580.00
Vehicles 101,400.00 101,400.00 101,400.00 101,400.00 101,400.00
Depreciation cost per
401,483.59 401,483.59 401,483.59 401,483.59 401,483.59
year
61
Table 1.7.22. Administrative Depreciation Schedule
DEPRECIATION
SERVICE ACQUISITION
ADMINISTRATION YEAR 1 YEAR 2 YEAR 3 YEAR 4
LIFE COST
Building 25 5,082,000.00 182,952.00 182,952.00 182,952.00 182,952.00
Equipment 15 1,270,736.50 114,366.29 114,366.29 114,366.29 114,366.29
Vehicles 15 749,000.00 44,940.00 44,940.00 44,940.00 44,940.00
Depreciation cost
342,258.29 342,258.29 342,258.29 342,258.29
per year
62
Table 1.7.23. Continuation
DEPRECIATION
ADMINISTRATION YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10
Building 182,952.00 182,952.00 182,952.00 182,952.00 182,952.00 182,952.00
Equipment 114,366.29 114,366.29 114,366.29 114,366.29 114,366.29 114,366.29
Vehicles 44,940.00 44,940.00 44,940.00 44,940.00 44,940.00 44,940.00
Depreciation cost
342,258.29 342,258.29 342,258.29 342,258.29 342,258.29 342,258.29
per year
63
Table 1.7.24. Continuation
DEPRECIATION
ADMINISTRATION YEAR 11 YEAR 12 YEAR 13 YEAR 14 YEAR 15
Building 182,952.00 182,952.00 182,952.00 182,952.00 182,952.00
Equipment 114,366.29 114,366.29 114,366.29 114,366.29 114,366.29
Vehicles 44,940.00 44,940.00 44,940.00 44,940.00 44,940.00
Depreciation cost per
342,258.29 342,258.29 342,258.29 342,258.29 342,258.29
year
64
Table 1.7.25. Processing Working Capital
65
Table 1.7.26. Continuation
66
Table 1.7.27. Continuation
67
Table 1.7.28. Administrative Working Capital
68
Table 1.7.29. Continuation
69
Table 1.7.30. Administrative Working Capital
70
Table 1.7.31. Summary of Amortization Schedule.
PROCESSING
Fixed Capital Investment 106,975,753.17
Working Capital 3,595,603.38
SUB-TOTAL 110,571,356.55
ADMINISTRATION
Fixed Capital Investment 7,986,736.50
Working Capital 2,752,276.84
SUB-TOTAL 10,739,013.34
73
Table 1.7.33. Summary of Projected Income Statement.
Processing
Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead
Indirect labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 32,113.53 99,738.30 90,011.06
Secondary Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
Depreciation 401,483.59 401,483.59 401,483.59
Sub-total: Secondary Proc
Cost of Sales 14,783,897.12 14,851,521.89 14,841,794.65
Total Cost of Sales 14,783,897.12 14,851,521.89 14,841,794.65
NET INCOME/(LOSS)
AFTER TAX 50,681,844.48 50,752,800.31 50,991,181.96
74
Table 1.7.34. Continuation
Processing
Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead
Indirect labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 118,959.83 147,908.60 176,857.36
Secondary Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
Depreciation 401,483.59 401,483.59 401,483.59
Sub-total: Secondary Proc
Cost of Sales 14,870,743.42 14,899,692.19 14,928,640.95
Total Cost of Sales 14,870,743.42 14,899,692.19 14,928,640.95
NET INCOME/(LOSS)
AFTER TAX 51,174,682.40 51,379,921.79 51,609,019.66
75
Table 1.7.35. Continuation.
Processing
Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead
Indirect labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 205,806.13 234,754.89 263,703.66
Secondary Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
Depreciation 401,483.59 401,483.59 401,483.59
Sub-total: Secondary Proc
Cost of Sales 14,957,589.72 14,986,538.48 15,015,487.25
Total Cost of Sales 14,957,589.72 14,986,538.48 15,015,487.25
NET INCOME/(LOSS)
AFTER TAX 51,864,302.23 52,148,322.51 52,463,882.41
76
Table 1.7.36. Continuation.
Processing
Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead
Indirect labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 292,652.42 292,652.42 292,652.42
Secondary Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
Depreciation 401,483.59 401,483.59 401,483.59
Sub-total: Secondary Proc
Cost of Sales 15,044,436.01 15,044,436.01 15,044,436.01
Total Cost of Sales 15,044,436.01 15,044,436.01 15,044,436.01
NET INCOME/(LOSS)
AFTER TAX 52,814,057.05 53,241,684.46 53,711,005.55
77
Table 1.7.37. Continuation.
Processing
Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead
Indirect labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 292,652.42 292,652.42 292,652.42
Secondary Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
Depreciation 401,483.59 401,483.59 401,483.59
Sub-total: Secondary Proc
Cost of Sales 15,044,436.01 15,044,436.01 15,044,436.01
Total Cost of Sales 15,044,436.01 15,044,436.01 15,044,436.01
NET INCOME/(LOSS)
AFTER TAX 54,226,085.44 54,791,385.62 55,411,802.57
78
Table 1.7.38. Summary of Return On Investment (ROI)
79
Table 1.7.39. Summary of Projected Cash Flow Statement.
CASH OUTFLOWS
Investments In Fixed Assets:
Processing 106,975,753.17 - -
Administration 7,986,736.50 - -
Operating Costs
Processing Direct Materials 0.00 0.00 0.00
Processing Direct Labor 0.00 10,206,000.00 10,206,000.00
Processing Overhead:
Indirect Labor 0.00 486,000.00 486,000.00
Repairs and Maintenance 0.00 32,113.53 99,738.30
Processing Utilities 0.00 3,658,300.00 3,658,300.00
NET CASHFLOW
BEFORE DEBT SERVICE 6,347,880.22 60,296,407.15 60,082,581.72
Less: Debt Service:
Payment of Principal 0.00 2,920,833.53 3,205,614.80
Payment of Interest 0.00 8,870,820.80 8,586,039.53
Total Debt Service 0.00 11,791,654.33 11,791,654.33
80
Table 1.7.40. Continuation
CASH OUTFLOWS
Investments In Fixed Assets:
Processing - - -
Administration - - -
Operating Costs
Processing Direct Materials 0.00 0.00 0.00
Processing Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead:
Indirect Labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 90,011.06 118,959.83 147,908.60
Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
NET CASHFLOW
BEFORE DEBT SERVICE 60,008,415.92 59,848,895.54 59,677,669.58
Less: Debt Service:
Payment of Principal 3,518,162.24 3,861,183.06 4,237,648.41
Payment of Interest 8,273,492.09 7,930,471.27 7,554,005.92
Total Debt Service 11,791,654.33 11,791,654.33 11,791,654.33
81
Table 1.7.41. Continuation
CASH OUTFLOWS
Investments In Fixed Assets:
Processing - - -
Administration - - -
Operating Costs
Processing Direct Materials 0.00 0.00 0.00
Processing Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead:
Indirect Labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 176,857.36 205,806.13 234,754.89
Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
NET CASHFLOW
BEFORE DEBT SERVICE 59,493,596.74 59,295,424.44 59,081,778.00
Less: Debt Service:
Payment of Principal 4,650,819.13 5,104,274.00 5,601,940.71
Payment of Interest 7,140,835.20 6,687,380.33 6,189,713.62
Total Debt Service 11,791,654.33 11,791,654.33 11,791,654.33
82
Table 1.7.42. Continuation
CASH OUTFLOWS
Investments In Fixed Assets:
Processing - - -
Administration - - -
Operating Costs
Processing Direct Materials 0.00 0.00 0.00
Processing Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead:
Indirect Labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 263,703.66 292,652.42 292,652.42
Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
NET CASHFLOW
BEFORE DEBT SERVICE 58,851,148.68 58,601,880.66 58,371,619.74
Less: Debt Service:
Payment of Principal 6,148,129.93 6,747,572.60 7,405,460.93
Payment of Interest 5,643,524.40 5,044,081.73 4,386,193.40
Total Debt Service 11,791,654.33 11,791,654.33 11,791,654.33
83
Table 1.7.43. Continuation
CASH OUTFLOWS
Investments In Fixed Assets:
Processing - - -
Administration - - -
Operating Costs
Processing Direct Materials 0.00 0.00 0.00
Processing Direct Labor 10,206,000.00 10,206,000.00 10,206,000.00
Processing Overhead:
Indirect Labor 486,000.00 486,000.00 486,000.00
Repairs and Maintenance 292,652.42 292,652.42 292,652.42
Processing Utilities 3,658,300.00 3,658,300.00 3,658,300.00
NET CASHFLOW
BEFORE DEBT
SERVICE 58,118,908.39 57,841,557.68 57,537,165.27
Less: Debt Service:
Payment of Principal 8,127,493.37 8,919,923.97 9,789,616.56
Payment of Interest 3,664,160.96 2,871,730.36 2,002,037.77
Total Debt Service 11,791,654.33 11,791,654.33 11,791,654.33
NET CASHFLOW
AFTER DEBT SERVICE 46,327,254.06 46,049,903.35 45,745,510.94
CASH BALANCE,
Beginning 530,249,100.76 576,576,354.82 622,626,258.17
84
Table 1.7.44. Continuation.
PARTICULARS YEAR 15
CASH INFLOWS
Loan Proceeds -
Equity -
Sales 113,146,152.00
Salvage Value -
Total Cash Inflows 113,146,152.00
CASH OUTFLOWS
Investments In Fixed Assets:
Processing -
Administration -
Operating Costs
Processing Direct Materials 0.00
Processing Direct Labor 10,206,000.00
Processing Overhead:
Indirect Labor 486,000.00
Repairs and Maintenance 292,652.42
Processing Utilities 3,658,300.00
NET CASHFLOW
BEFORE DEBT SERVICE 57,203,094.61
Less: Debt Service:
Payment of Principal 10,744,104.17
Payment of Interest 1,047,550.16
Total Debt Service 11,791,654.33
85
Table 1.7.45. Net Cash Flow and Payback Time
YEAR 0 1 2 2 2
Net Cash
(121,310,370) 48,504,753 48,290,927 48,216,762 48,057,241
Flow
(121,310,370) (72,805,617) (24,514,690) 23,702,072 71,759,313
Payback
0 1 1 1 1
time
73
Table 1.7.46. Continuation.
YEAR 2 2 2 2 2
Net Cash
47,886,015 47,701,942 47,503,770 47,290,124 47,059,494
Flow
119,645,328 167,347,271 214,851,041 262,141,165 309,200,659
Payback
1 1 1 1 1
time
74
Table 1.7.47. Continuation
YEAR 2 2 2 2 2 2
Net Cash
46,810,226 46,579,965 46,327,254 46,049,903 45,745,511 45,411,440
Flow
356,010,885 402,590,851 448,918,105 494,968,008 540,713,519 586,124,959
Payback
1 1 1 1 1 1
time
75
Table 1.7.48. Projected Balance Sheet Statement
ASSETS
Current Assets
Cash On Hand and in Banks 6,347,880.22 54,852,633.05
Total Currents Assets 6,347,880.22 54,852,633.05
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
89
Table 1.7.49. Continuation
ASSETS
Current Assets
Cash On Hand and in Banks 103,143,560.43 151,360,322.02
Total Currents Assets 103,143,560.43 151,360,322.02
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
90
Table 1.7.50. Continuation
ASSETS
Current Assets
Cash On Hand and in Banks 199,417,563.24 247,303,578.49
Total Currents Assets 199,417,563.24 247,303,578.49
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
91
Table 1.7.51. Continuation
ASSETS
Current Assets
Cash On Hand and in Banks 295,005,520.89 342,509,291.00
Total Currents Assets 295,005,520.89 342,509,291.00
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
92
Table 1.7.52. Continuation
ASSETS
Current Assets
Cash On Hand and in Banks 389,799,414.67 436,858,909.03
Total Currents Assets 389,799,414.67 436,858,909.03
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
93
Table 1.7.53. Continuation
ASSETS
Current Assets
Cash On Hand and in Banks 483,669,135.35 530,249,100.76
Total Currents Assets 483,669,135.35 530,249,100.76
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
94
Table 1.7.54. Continuation
ASSETS
Current Assets
Cash On Hand and in Banks 576,576,354.82 622,626,258.17
Total Currents Assets 576,576,354.82 622,626,258.17
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
95
Table 1.7.55. Continuation
ASSETS
Current Assets
Cash On Hand and in Banks 668,371,769.11 713,783,209.38
Total Currents Assets 668,371,769.11 713,783,209.38
Equity:
Authorized Capital Stock 30,327,592.47 30,327,592.47
Total Paid-up Capital 30,327,592.47 30,327,592.47
96