Chapter 5

FINANCIAL FEASIBILITY

This chapter discusses the financial aspect of JASE Pastries. This chapter

helps the proponents to determine how much capital they need to start the

business. It includes all the expenses that JASE Pastries will acquire while

establishing and running the business. This chapter also helps to find out

whether the business will be profitable despite of many competitors in the

market.

Financial Assumptions

1. Selling price of JASE Pastries products are listed below:

PRODUCTS PRICES

Roll Cake PHP 105.00

Cupcakes per box (6 pcs) PHP 95.00

Cookies per box (6 pcs) PHP 80.00

2. The price was based on the expenses computation and direct labor in

making the products.

3. Sales demand increased 7% yearly.

4. Raw materials and other consumables materials increase 3% annually.

5. Permits, fees and licenses are expected to increase 2% annually.

6. Salary will increase by 2% annually.
 79

7. Other expenses expected to increase 3% annually.

8. Depreciation expense is computed on a straight-line basis with an

estimated useful life of 5 years.

Initial Capital Requirement

JASE Pastries’ owners agreed to contribute an equal sharing of capital

amount of PHP 170,000.00 each.

Table 12

Initial Capital Requirement

JASE Pastries’ owners Ratio Invested Amount

Ms. Erika Z. Barcel 25% PHP 170,000.00

Ms. Shane D. Ducay 25% 170,000.00

Ms. Jenalyn A. Epa 25% 170,000.00

Ms. Analiza V. Nuguid 25% 170,000.00

TOTAL 100% PHP 680,000.00

The table shows that the JASE Pastries owner contribution ratio is 25%

each, amounting to PHP 170,000.00 and with the total invested capital

amounting to PHP 680,000.00. The owners agreed to give each contribution after

the expenses have been computed.

 80

Schedule 1

Total Projected Cost

Particulars Amount

Facilities and Equipment

Equipment 46,100.00

Furniture and Fixtures 25,755.00

Subtotal PHP 71, 855.00

Raw Materials***** 249,624.00

Baking Tools***** 7,720.00

Office Supplies*** 1,425.00

Packaging Materials*** 79,560.00

Cleaning Materials* 1,290.00

Miscellaneous Expenses* 2,595.00

Subtotal PHP 342,214.00

Operating Expenses

Permit, Fees and Licenses 14,105.00

Leasehold Improvement 5,385.00

Labor Expense 10,500.00

Utilities Expense** 6,500.00

Rent Expense*** 24,000.00

Advertising Expense 1,250.00

Salaries Expense**** 173,700.00

Employers Contribution**** 18,700.50

 81

Transportation Expense** 1,000.00

Subtotal 255,140.50

TOTAL PHP 669,209.50

* Cleaning Materials and Miscellaneous will be purchased every month.

**The Transportation and Utilities Expense are monthly basis.

***Office Supplies will be purchased every 2 months.

****The Salaries and Employers Mandatory Contribution are good for 3 months.

*****The Raw Materials and Packaging Materials are good for 6 months.

Schedule 1 shows the total projected cost of establishing JASE Pastries

which is amounting to PHP 669,209.50

 82

Schedule 2

Permits, Fees and Licenses

Items Amount
Municipal and Barangay
Barangay Clearance PHP 500.00
Community Tax Certificate 25.00
Mayor’s Permit 500.00
Sanitary Fee 150.00
Garbage Fee 100.00
Fire Inspection Fee 190.00
Business Plate Sticker 40.00
Electrical Inspection Fee 150.00
Plumbing Inspection Fee 60.00
Sub-Total 1,715.00
SEC
Reservation of Proposed name 100.00
Filing Fee 2,000.00
Legal Research Fee 20.00
By Laws 1,010.00
Sub-Total 3,130.00
BIR
Registration Fee 500.00
Documentary Stamps 15.00
Certification Fee 15.00
Sub-Total 530.00
DOLE
Filing Fee 2,000.00
License Fee 3,000.00
Sub-Total 5,000.00
FDA
Registration Fee 3,000.00
License Fee 200.00
Sub-Total 3,200.00
DTI
Registration 500.00
Documentary Stamps 15.00
Certification Fee 15.00
Sub-Total 530.00
TOTAL PHP 14,105.00
Schedule 2 shows PHP 14,105.00 is the total cost of permits, fees and

licenses needed by JASE Pastries to legalize its operation.

 83

Schedule 3

Leasehold Improvements

Particulars Quantity Unit Unit Cost Total Cost

For Renovation:
½ Plywood 3 PC PHP 860.00 PHP 2,580.00
Common Nails 2 kg 30.00 60.00
Paint 3 Gallon (4 Liters) 565.00 1,695.00
Paint Brush 1 Set 25.00 25.00
Paint Roller 2 PC 75.00 150.00
Sandpaper 10 PC 10.00 100.00
Wood Glue 1 Bottle (500 60.00 60.00
grams)
Wood Putty 1 Container (1.5 kg) 175.00 175.00
Wood Planks 2 Set (10 PCS) 270.00 540.00
TOTAL PHP 5,385.00

Schedule 3 shows the expenses in renovating the JASE Pastries store

facility amounting to PHP 5,385.00.

 84

Schedule 4

Labor Expense

Daily For 10 Days

Carpenter PHP 550.00 PHP 5,500.00

Painter 500.00 5,000.00

TOTAL PHP10,500.00

Schedule 4 show the labor expense for renovating the store facility that is

good for 10days. The daily compensation for the carpenter is PHP 550.00 and for

the painter is PHP 500.00 a day. The total amount of labor expense for 10 days

is PHP 10,500.00.

Schedule 5

Rent Expense

Monthly Expense Annual Expense

Rent Expense PHP 8,000.00 PHP 96,000.00

Schedule 5 stated the amount of JASE Pastries monthly rent and its total

rent expense yearly. The monthly rent is amounting to PHP 8,000.00 with a total

rent expense of PHP 96,000.00 annually.

 85

Schedule 6

Purchase of Raw Materials

Particulars Quantity Unit Unit Cost Total Cost

All-Purpose Flour 86 kg PHP PHP
50.00 4,300.00
Baking Powder 4 kg 120.00 480.00
Baking Soda 4.5 kg 5.540.00 180.00
Cake Flour 13 kg 60.00 780.00
Chocolate Bar 10 Pack (500 grams) 70.00 700.00
Eggs 56 Tray 105.00 7,000.00
Food Color 10 Bottle (30 ml) 40.00 400.00
Malunggay Powder 3 kg 350.00 1,050.00
Non-Fat Milk 70 Liter 60.00 4,200.00
Oil 1 Bottle (1/2 Liter) 149.00 149.00
Salt 3 kg 20.00 60.00
Sugar 126 kg 60.00 7,560.00
Sprinkles 8 Pack (50 grams) 35.00 280.00
Ube Flavoring 25 kg 205.00 5,125.00
Unsalted Butter 190 Pack (200 grams) 40.00 7,600.00
Vanilla Extract 6 Bottle (350 ml) 40.00 240.00
Whipping cream 3 kg 500.00 1,500.00
powder
TOTAL PHP
41,604.00

Schedule 6 shows the cost of raw materials needed on making JASE

Pastries products. The total amount of PHP 41,604.00 is allotted to 1 month

production budget of the shop.

 86

Schedule 7

Baking Tools

Particulars Quantity Unit Unit Cost Total Cost

Baking Sheet Tray 5 PC PHP 120.00 PHP 600.00
Baking Gloves 1 Pair 70.00 70.00
Cookie Scoops 2 PC 70.00 140.00
Cookie Storage 6 PC 130.00 780.00
Cooling Racks 5 PC 130.00 650.00
Cupcake Mold 5 PC 150.00 750.00
Hand Mixer 2 PC 365.00 730.00
Icing Tips 1 Set 140.00 140.00
Kitchen Scissor 1 PC 100.00 100.00
Kitchen Knife 1 Set 250.00 250.00
Measuring Cups 1 Set 70.00 70.00
Measuring Spoons 1 Set 30.00 30.00
Mixing Bowl 5 PC 200.00 1,000.00
Oven Thermometer 3 PC 90.00 270.00
Pastry Brush 2 PC 25.00 50.00
Plastic Scraper 2 PC 25.00 50.00
Preparation Bowls 1 Set 120.00 120.00
Reusable Silicone 5 PC 40.00 200.00
Piping Bag
Roll Cake Pan 1 Set (3 PCS) 180.00 180.00
Rubber Spatulas 2 PC 50.00 100.00
Sifter 2 PC 70.00 140.00
Silicone Baking 5 PC 260.00 1,300.00
Mats
TOTAL PHP 7,720.00

Schedule 7 shows the total expenses for the needed baking tools of JASE

Pastries amounting to PHP 7,720.00

 87

Schedule 8

Packaging Materials

Particulars Quantity Unit Unit Cost Total Cost

Cookies Box 112 Set (10 PCS) PHP 50.00 PHP 5,600.00

Cupcake Box 76 Set (10 PCS) 60.00 4,560.00

Cupcake Liners 22 Set (200 PCS) 55.00 1,210.00

Pastry Paper Bag 1 Set (100 PCS) 130.00 130.00

Ribbon 4 Roll (25 Yards) 15.00 60.00

Roll Cake 17 Set (10 PCS) 100 1,700.00

Container

TOTAL PHP 13,260.00

Schedule 8 shows the total amount of JASE Pastries packaging materials

for its products amounting to PHP 13,260.00 which is allotted from one month

budget of the shop

 88

Schedule 9

Salaries and Wages

Position Daily Salary and Monthly Salary Yearly Salary

Allowance and Allowance and Allowance
Store Manager PHP 695.00 PHP 20,850.00 PHP 250,200.00
Baker 535.00 16,050.00 192,600.00
Kitchen Assistant 350.00 10,500.00 126,000.00
Counter Staff 350.00 10,500.00 126,000.00
TOTAL PHP 57,900.00 PHP 694,800.00

Schedule 9 shows the daily, monthly and yearly salary of JASE Pastries

employees. The store manager receives PHP 695.00 a day; PHP 20,850.00 a

month. The baker receives PHP 535.00 per day; PHP 16,050.00 per month. Both

the kitchen assistant and the counter staff receive PHP 350.00 daily; PHP

10,500.00monthly. The total payment for the monthly salary of JASE Pastries

employees is PHP 57,900.00 for a total of PHP 694,800.00 yearly. The salary of

the store manager and the baker are based on ph.indeed.com while the salary of

the kitchen assistant and the counter staff are based on the Region IV-A

minimum wage according to the Department of Labor and Employment.

 89

Schedule 10

Employee’s Salary and other Mandatory Contribution

Position Daily Monthly SSS Phil- Pag- EC Total Total Net

Rate Salary Health ibig Deductio Pay
n
Store 695.00 20,850.00 945.00 350.00 100.00 30 1,425.00 19,425.00
Manager
Baker 535.00 16,050.00 742.50 350.00 100.00 30 1,222.50 14,827.50
Kitchen 350.00 10,500.00 472.50 350.00 100.00 10 932.50 9,567.50
Assistant
Counter 350.00 10,500.00 472.50 350.00 100.00 10 932.50 9,567.50
Staff
TOTAL 4,512.50 53,387.50

Schedule 10 shows the JASE Pastries employees salary and their

monthly mandatory contribution. The monthly salary deduction for the store

manager is PHP 1,425.00; for the baker is PHP 1,222.50; the kitchen assistant

and the counter staff monthly salary deduction is PHP 932.00. The total salary

deduction of all employees is PHP 4,512.50 per month. The total net pay for all

the employees is PHP 53,387.50.

 90

Schedule 11

Employer’s Mandatory Contribution

EMPLOYER SSS, PHILHEALTH, PAG IBIG

Personnel EC SSS Phil Pag- Deduction Total
Health ibig (Monthly) Deduction
(Yearly)
Store 30 1,815.00 175.00 100.00 2,120.00 25,440.00
Manager
Baker 30 1,432.50 175.00 100.00 1,737.50 20,850.00
Kitchen 10 902.50 175.00 100.00 1,187.50 14,250.00
Assistant
Counter 10 902.50 175.00 100.00 1,187.50 14,250.00
Staff
TOTAL PHP PHP
6,232.50 74,790.00

Schedule 11 shows the monthly and yearly employer’s mandatory

contribution subjected to Social Security System (SSS), Phil Health and Pag-ibig

fund of employees. The total monthly mandatory contribution of the JASE

Pastries for all the employees is PHP 6,232.50; amounting to PHP 74,790.00

yearly.
 91

Schedule 12

Office Supplies Expense

Particulars Quantity Unit Unit Cost Total Cost

Ball Pen 1 Box PHP 50.00 PHP 50.00
Ball Pen Eraser 1 PC 10.00 10.00
Bond Paper 1 Ream 150.00 150.00
Calculator 1 PC 95.00 95.00
File Organizer 1 PC 100.00 100.00
Folder 10 PC 6.00 60.00
Fastener 1 Box 30.00 30.00
Glue 1 PC 35.00 35.00
Pencil 1 Box 40.00 40.00
Pencil Eraser 2 PC 10.00 20.00
Pencil Sharpener 2 PC 5.00 10.00
Printer Ink 8 PC 25.00 200.00
Puncher 1 PC 35.00 35.00
Receipt Paper 5 Pad 15.00 75.00
Scissors 2 PC 15.00 30.00
Scotch Tape 2 PC 15.00 30.00
Stapler 1 PC 60.00 60.00
Staple Wire 1 Box 25.00 25.00
Sticker Paper 2 Pack (100 PCS) 175.00 350.00
TOTAL PHP 1,425.00

Schedule 12 shows the prices and quantity of office supplies needed by

JASE Pastries for one month with a total of PHP 1,145.00.

 92

Schedule 13

Utilities Expense

Particulars Monthly Expense Annual Expense

Electricity PHP 5,000.00 PHP 60,000.00
Water 1,500.00 18,000.00
TOTAL PHP 6,500.00 PHP 78,000.00

Schedule 13 shows the monthly and annual expense of JASE Pastries

utilities amounting to PHP 6,500.00 per month and PHP 78,000.00 yearly.

Schedule 14

Advertising Expense

Particulars Quantity Unit Unit Cost Total Cost

Flyers 1 Ream PHP 300.00 PHP 300.00
Loyalty Cards 1 Bundle 200.00 200.00
Tarpaulin
3x5 1 PC 250.00 250.00
Sign Board 1 PC 500.00 500.00
TOTAL PHP 1,250.00

To promote JASE Pastries shop and its products, flyers will be distributed

to the public. A sign board and a tarpaulin will be posted in front of the shop.

Schedule 14 shows that JASE Pastries will a lot PHP 1,250.00 for the advertising

of the shop.
 93

Schedule 15

Transportation Expense

Monthly Expense Annual expense

Transportation Expense PHP 1,000.00 PHP 12,000.00

Schedule 15 shows the monthly and annually transportation expense of

JASE Pastries amounting to PHP 1,000.00 per month and PHP 12,000.00 per

year.

Schedule 16

Furniture and Fixtures

Particulars Quantity Unit Unit Cost Total Cost

Baking Table 1 PC PHP 5,000.00 PHP 5,000.00
Chairs 5 PC 285.00 1,425.00
Desktop Table 1 PC 1750.00 1,750.00
Light Bulb 6 PC 100.00 600.00
Pastry Glass Display 1 PC 10,000.00 10,000.00
Round Table 2 PC 690.00 1,380.00
Kitchen Cabinet 1 PC 5,650.00 5,600.00
TOTAL PHP 25,755.00

Schedule 16 shows the total furniture and fixtures expense of JASE

Pastries shop amounting to PHP 25,755.00.

 94

Schedule 17

Equipment

Particulars Quantity Unit Unit Cost Total Cost

Air Conditioner 1 PC PHP 7,000.00 PHP 7,000.00
Cash Register 1 PC 10,000.00 10,000.00
CCTV Camera 2 PC 600.00 1,200.00
Desk Fan 1 PC 700.00 700.00
Oven 1 PC 15,000.00 15,000.00
Printer 1 PC 3,500.00 3,500.00
Refrigerator 1 PC 8,700.00 8,700.00
TOTAL PHP 46,100.00

Schedule 17 shows the JASE Pastries expense for all the equipment that

will be use in business operation amounting to PHP 46,100.00.

 95

Schedule 18

Depreciation Expenses

Particulars Cost Estimated Useful Depreciation/

Life Year
Air Conditioner PHP 7,000.00 5 PHP 1,400.00
Cash Register 10,000.00 5 2,000.00
CCTV Camera 1,200.00 5 240.00
Desk Fan 700.00 5 140.00
Oven 15,000.00 5 3,000.00
Printer 3,500.00 5 700.00
Refrigerator 8,700.00 5 1,740.00
TOTAL PHP 9,220.00

Schedule 18 shows the 5 years estimated useful life of the equipment and

its depreciation expense is computed on a straight-line basis amounting to

PHP 9,220.00
 96

Schedule 19

Cleaning Materials

Particulars Quantity Unit Unit Cost Total Cost

Automatic 1 PC PHP 100.00 PHP 100.00
Dishwashing
Brush
Broom and 1 Set 200.00 200.00
Dustpan
Dishwashing 2 Gallon 120.00 240.00
Liquid
Dishwashing 2 Pack (5 PCS) 20.00 40.00
Sponge
Kitchen towel 3 PC 10.00 30.00
Spin Mop 1 PC 265.00 265.00
Soap Dispenser 2 PC 40.00 80.00
Trash Bin 1 PC 95.00 95.00
Trash Bag 2 Pack (25 PCS) 20.00 40.00
Other Cleaning 200.00
Materials
TOTAL PHP 1,290.00

Schedule 19 shows the total monthly expense for the cleaning materials of

JASE Pastries amounting to PHP 1,290.00

 97

Schedule 20

Miscellaneous Expense

Particulars Quantity Unit Unit Cost Total Cost

Alcohol 1 Gallon PHP 250.00 PHP 250.00
Apron 2 PC 35.00 70.00
Disposable 2 Pack (100 PCS) 10.00 20.00
Plastic Gloves
Doormat 1 PC 130.00 130.00
Disinfectant
Fire Extinguisher 2 PC 690.00 1,380.00
(5 lbs.)
Hairnet 3 PC 35.00 105.00
Parchment Paper 10 PC 50.00 500.00
Tissue 5 Packs (350 10.00 50.00
Sheets)
Spray Bottle 3 PC 30.00 90.00
TOTAL PHP 2,595.00

Schedule 20 shows the total monthly miscellaneous expense of JASE

Pastries amounting to PHP 2,595.00

 98

Table 13

Projected Demand

(Daily, Weekly, Monthly, Yearly)

Product Daily Weekly Monthly Yearly

Roll Cake 6 42 168 2,016

Cookies 40 280 1,120 13,440

Cupcakes 27 189 756 9,072

TOTAL 511 2,044 24,528

The table shows the projected daily, weekly, monthly, and yearly demand

for the products of JASE Pastry. It shows the corresponding assumed demand

per product wherein the total daily demand is 73 orders; the total weekly demand

is 511 orders; the total monthly demand of the product is 2,044 orders and the

total yearly demand of the product is 24,528 orders.

 99

Table 14

Projected Demand for 5 Years

2022-2026

Products 2022 2023 2024 2025 2026

Roll Cakes 2,016 2,157 2,308 2,470 2,643
Cookies 13,440 14,381 15,388 16,465 17,617
Cupcakes 9,072 9,707 10,386 11,113 11,891
TOTAL 24,528 26,245 28,082 30,048 32,151

The table shows the projected demand for products from JASE Pastries

for 5 years 2022-2026. It shows the total corresponding annual demand per

products, which increases 7% per year.

Table 15

Projected Sales

Product Quantity Price Daily Weekly Monthly Yearly

Roll Cake 6 PHP PHP PHP PHP PHP
105.00 630.00 4,410.00 17,640.00 211,680.00
Cookies 40 80.00 3,200.00 22,400.00 89,600.00 1,075,200.00

Cupcakes 27 95.00 2,565.00 17,955.00 71,820.00 861,840.00

TOTAL PHP PHP PHP PHP

6,395.00 44,765.00 179,060.00 2,148,720.00

The table shows the projected daily, weekly, monthly and yearly sales of

the product of JASE Pastries. It shows the corresponding assumed sales per

product wherein the total daily sale is PHP 6,395.00; the total weekly sales is

PHP 44,765.00; the monthly sales is PHP 179,060.00; and the total yearly sales

is PHP 2,148,720.00
 100

Table 16

Projected Sales for 5 Years

2022-2026

Product 2022 2023 2024 2025 2026

Roll Cake PHP PHP PHP PHP PHP

211,680.00 226,497.60 242,352.43 259,317.10 277,469.30

Cookies 1,075,200.00 1,150,464.00 1,230,996.48 1,317,166.23 1,409,367.87

Cupcakes 861,840.00 922,168.80 986,720.62 1,055,791.06 1,129,696.43

TOTAL PHP PHP PHP PHP PHP

2,148,720.00 2,299,130.40 2,460,069.53 2,632,274.39 2,816,533.60

The table shows the projected 5 years sales of JASE Pastries products. It

shows the corresponding assumed sales per product, wherein the total yearly

sales for 2022 is PHP 2,148,720.00; the total yearly sales for 2023 is PHP

2,299,130.40; the total yearly sales for 2024 is PHP 2,460,069.53; on the year

2025 it will have total sales of PHP 2,632,274.39; on the year 2026 it will have

total sales of PHP 2,816,533.60. The projected sales assume that JASE Pastries

sales will increase 7% yearly due to high demand for the products.
 101

Table 17

Statement of Cost of Goods Sold for 5 Years

Statement of Cost of Goods Sold

2022 2023 2024 2025 2026
Beg.
Inventory
Raw PHP PHP PHP PHP PHP
Materials 499,248.00 514,225.44 529,652.20 545,541.77 561,908.02
Packaging 159,120.0
Materials 0 163,893.60 168,810.41 173,874.72 179,090.96
Cost of PHP PHP PHP PHP PHP
Goods 658,368.00 678,119.04 698,462.61 719,416.49 740,998.98
Sold

The table shows the statement of cost of goods sold for the 5 years

wherein the cost of goods sold for year 2022 is PHP 658,368.00; the cost of

goods sold for the year 2023 is PHP 678,119.04; the cost of goods sold for the

year 2024 is PHP 698,462.61; the cost of goods sold for the year 2025 is PHP

719,416.49 and the cost of goods sold for the year 2026 is PHP 740,998.98. The

annual increase rate of the materials is estimated at 3%.

 Schedule 21
Projected Income Statement
2022 2023 2024 2025 2026
Sales 2,148,720.00 2,299,130.40 2,460,069.53 2,632,274.39 2,816,533.60
Less: Cost of goods 658,368.00 678,119.04 698,462.61 719,416.49 740,998.98
Sold
Gross Income 1,490,352.00 1,621,011.36 1,761,606.92 1,912,857.90 2,075,534.62

Less: Operating
Expenses
Permits, Fees and 14,105.0 14,387.10 14,674.84 14,968.34 15,267.71
Licenses 0
Leasehold Improvements 5,385.00 - - - -
Labor Expense 10,500.0 - - - -
0
Baking Tools 7,720.00 7,951.60 8,190.15 8,435.85 8,688.93
Rent Expense 96,000.0 96,000.00 96,000.00 96,000.00 96,000.00
0
Salaries Expense 694,800.00 708,696.00 722,869.92 737,327.32 752,073.87
Employers’ Contribution 74,790.0 76,285.80 77,811.52 79,367.75 80,955.11

102
 0
Office Supplies 8,550.00 8,806.50 9,070.70 9,342.82 9,623.10

102
Utilities Expense 78,000.00 80,340.00 82,750.20 85,232.71 87,789.69
Advertisement 1,250.00 1,287.50 1,326.13 1,365.91 1,406.89
Expense
Transportation 12,000.00 12,360.00 12,730.80 13,112.72 13,506.10
Expense
Depreciation 9,220.00 9,220.00 9,220.00 9,220.00 9,220.00
Cleaning 15,480.00 15,944.40 16,422.73 16,915.41 17,422.87
Materials
Miscellaneous 31,140.00 32,074.20 33,036.43 34,027.52 35,048.35
Expense
Total Expenses 1,058,940.00 1,063,353.10 1,084,103.42 1,105,316.35 1,127,002.62
Income Before 431,412.00 557,658.26 677,503.50 807,541.55 948,532.00
Tax
Less: 30% 129,423.60 167,297.48 203,251.05 242,262.47 284,559.60
Income Tax
Income After 301,988.40 390,360.78 474,252.45 565,279.08 663,972.40
Tax

Schedule 21 states the projected income of JASE Pastries for 5 years

103
 Schedule 22
Projected Cash flow Statement
2022 2023 2024 2025 2026
Cash Inflows
Sales 2,148,720.00 2,299,130.40 2,460,069.53 2,632,274.39 2,816,533.60
Capital Investment 680,000.00
Total Cash Inflows 2,828,720.00 2,299,130.40 2,460,069.53 2,632,274.39 2,816,533.60

Cash Outflows
Fixed Cost
Equipment 46,100.00 - - - -
Furniture and Fixture 25,755.00 - - - -
Total Fixed Cost 71,855.00 - - - -

Variable Cost
Raw Materials 499,248.00 514,225.44 529,652.20 545,541.77 561,908.02
Packaging Materials 159,120.00 163,893.60 168,810.41 173,874.72 179,090.96
Permits, Fees and 14,105.00 14,387.1 14,674.84 14,968.34 15,267.71
Licenses 0
Leasehold Improvements 5,385.00 - - - -
Labor Expense 10,500.00 - - - -
Baking Tools 7,720.00 7,951.60 8,190.15 8,435.85 8,688.93
Rent Expense 96,000.00 96,000.0 96,000.00 96,000.00 96,000.00
0

104
Salaries Expense 694,800.00 708,696.00 722,869.92 737,327.32 752,073.87
Employers’ Contribution 74,790.00 76,285.80 77,811.5 79,367.75 80,955.11
2
Office Supplies 8,550.00 8,806.50 9,070.70 9,342.82 9,623.10
Utilities Expense 78,000.00 80,340.00 82,750.2 85,232.71 87,789.69
0
Advertisement Expense 1,250.00 1,287.50 1,326.13 1,365.91 1,406.89
Transportation Expense 12,000.00 12,360.00 12,730.8 13,112.72 13,506.10
0
Cleaning Materials 15,480.00 15,944.40 16,422.7 16,915.41 17,422.87
3
Miscellaneous Expense 31,140.00 32,074.20 33,036.4 34,027.52 35,048.35
3
Tax Expenses 129,423.60 167,297.48 203,251.05 242,262.47
Total Variable Cost 1,708,088.00 1,861,675.74 1,940,643.51 2,018763.89 2,101,044.07
Total Cash Outflow 1,779,943.00 1,861,675.74 1,940,643.51 2,018763.89 2,101,044.07
Net Cash flow 1,048,777.00 437,454.66 519,426.02 613,510.50 715,489.53
Cash Beginning 1,048,777.00 1,486,231.66 2,005,657.68 2,619,168.18
Cash Balance 1,048,777.00 1,486,231.66 2,005,657.68 2,619,168.18 3,334,657.71

Schedule 23 states the projected cash flow of JASE Pastries for 5 years

105
 Schedule 23
Projected Balance Sheet
As of 2022-2026
2022 2023 2024 2025 2026
Assets
Current Asset
Cash 1,048,777.00 1,486,231.6 2,005,657.68 2,619,168.18 3,334,657.71
6
Total current Asset 1,048,777.00 1,486,231.6 2,005,657.68 2,619,168.18 3,334,657.71
6
Fixed Assets
Equipment 46,100.00 46,100.00 46,100.00 46,100.00 46,100.00
Furniture and Fixture 25,755.00 25,755.00 25,755.00 25,755.00 25,755.00
Less: Accumulated Depreciation 9,220.00 18,440.00 27,660.00 34,975.00 46,100.00
Total Fixed Assets 62,635.00 53,415.00 44,195.00 34,975.00 25,755.00
Total Assets 1,111,412.00 1,539,646.6 2,049,852.68 2,654,143.18 3,360,412.71
6

Current Liabilities
Income Tax Payable 129,123.60 167,297.48 203,251.05 242,262.47 284,559.60
Total Current Liabilities 129,123.60 167,297.48 203,251.05 242,262.47 284,559.60

Partners Equity
Capital Contribution 680,000.00 680,000.00 680,000.00 680,000.00 680,000.00
Net Income 301,988.40 390,360.78 474,252.45 565,279.08 663,972.40
Retained Earnings 301,988.40 692,349.18 1,166,601.63 1,731,880.71
Total Partners Equity 981,988.40 1,372,349.1 1,846,601.63 2,411,880.71 3,075,853.11
8

106
Liabilities & Partners Equity 1,111,412.00 1,539,646.6 2,049,852.68 2,654,143.18 3,360,412.71
6

Schedule 23 states the projected balance sheet of JASE Pastries for 5 years

106
 Schedule 24
Financial Ratio
As of 2022-2026
Liquidity Ratio 2022 2023 2024 2025 2026

Current Ratio
Total Current Assets 1,048,777.00 1,486,231.6 2,005,657.68 2,619,168.18 3,334,657.71
6
Divided by: Total Current Liabilities 129,123.60 167,297.48 203,251.05 242,262.47 284,559.60
Current Ratio 8.12 8.88 9.87 10.81 11.72

Debt Total to Assets

Total Liabilities 129,123.60 167,297.48 203,251.05 242,262.47 284,559.60
Divided by: Total Assets 1,111,412.00 1,539,646.6 2,049,852.68 2,654,143.18 3,360,412.71
6
Debt to Total Asset Ratio 0.12 0.11 0.10 0.09 0.08

Owner’s Equity to Total Asset Ratio

Total Owners Equity 981,988.40 1,372,349.1 1,846,601.63 2,411,880.71 3,075,853.11
8
Divided by: Total Assets 1,111,412.00 1,539,646.6 2,049,852.68 2,654,143.18 3,360,412.71
6
Owner’s Equity to Total Asset Ratio 0.88 0.89 0.90 0.91 0.92

Schedule 24 states the JASE Pastries financial ratio for 5 years

107
 Schedule 25
Profitability Ratio
Profitability Margin in Sales 2022 2023 2024 2025 2026
Net Income 301,988.40 390,360.78 474.252.45 565,279.08 663,972.40
Divided by: Sales 2,148,720.00 2,299,130.40 2,460,069.53 2,632,274.39 2,816,533.60
Profit In Sales Ratio 0.14 0.17 0.19 0.21 0.24
Rate on Return Asset
Net Income 301,988.40 390,360.78 474.252.45 565,279.08 663,972.40
Divided by: Total Asset 1,111,412.00 1,539,646.66 2,049,852.68 2,654,143.18 3,360,412.71
Rate on Asset (ROA) 0.27 0.25 0.23 0.21 0.20
Return ON Equity (ROE)
Net Income 301,988.40 390,360.78 474.252.45 565,279.08 663,972.40
Divided by: Partners Equity 981,988.40 1,372,349.18 1,846,601.63 2,411,880.71 3,075,853.11
Return of Equity (ROE) 0.31 0.28 0.26 0.23 0.22
Return On Investment
Net Income 301,988.40 390,360.78 474.252.45 565,279.08 663,972.40
Divided by: Total Investment 680,000.00 680,000.00 680,000.00 680,000.00 680,000.00
Return On Investment (ROI) 0.44 0.57 0.70 0.83 0.98

108
 Total Asset Turnover
Sales 2,148,720.00 2,299,130.40 2,460,069.53 2,632,274.39 2,816,533.60
Divided by: Total Asset 1,111,412.00 1,539,646.66 2,049,852.68 2,654,143.18 3,360,412.71
Total Asset Turnover 1.93 1.49 1.20 0.99 0.84
Rate of Gross Income
Gross Cost 1,058,940.00 1,063,353.10 1,084,103.42 1,105,316.35 1,127,002.62
Divided by: Gross Income 1,490,352.00 1,621,011.36 1,761,606.92 1,912,857.90 2,075,534.62
Return of Gross Cost to 0.71 0.66 0.62 0.58 0.54
Gross Income

These ratios measure the firm’s overall effectiveness and the ability to increase the asset value as a result of its

operation. Profit in Sales Ratio of 0.14 signifies that for every PHP 1.00 there is a net income of 0.14.

Return on Asset (ROA) of 0.27 implies that for every PHP 1.00 asset of JASE Pastries, 0.27 is earned.

Return on Equity (ROE) of 0.31 signifies that for every PHP 1.00 of investment, 0.31 centavos is earned.

Total Asset Turnover of 1.93 signifies that for every PHP 1.00 of total asset, there are 1.93 sales.

Gross Cost to Gross Income Ratio of 0.71 signifies that for every PHP 1.00 gross income, there is 0.71 gross cost,
which is expected to be constant over the succeeding years.

109
 Schedule 26

Profit Distribution

2022 2023 2024 2025 2026

Ms. Barcel 75,497.10 97,590.20 118,563.11 141,319.77 165,993.10

Ms. Ducay 75,497.10 97,590.20 118,563.11 141,319.77 165,993.10

Ms. Epa 75,497.10 97,590.20 118,563.11 141,319.77 165,993.10

Ms. Nuguid 75,497.10 97,590.20 118,563.11 141,319.77 165,993.10

TOTAL 301,988.40 390,360.78 474,252.45 565,279.08 663,972.40

Schedule 26 states the profit distribution of the owners of JASE Pastries for 5 years

110
 111

Schedule 27

Payback Period

The payback period refers to the amount of time, specifically in years it will

take to recover the initial investment. The payback period is the amount of time it

takes for an investment to reach the break-even point.

Payback Period = Initial Investment PHP 680,000.00

Average Annual Profit PHP 479,170.62

=1.41911872644

=1.42

Period Annual Profit

2022 Php 301,988.40
2023 Php 390,360.78
2024 Php 474,252.45
2025 Php 565,279.08
2026 Php 663,972.40
Total Profit Php 2,395,853.11
Divided By 5 Years
Average Annual Profit Php 479,170.62
Payback Period 1.42

Schedule 27 states that the payback period is 1.42 indicates that in less

than 2 years JASE Pastries will be able to recover the initial investment.