MARKETING EXPENSE

PARTICULAR MONTH YEAR

Promotional Expense
Tarpaulin 350.00 350.00
Transportation 200.00 2,400.00
TOTAL MARKETING EXPENSE 550.00 2,750.00

ADMINISTRATIVE OVERHEAD EXPENSE

PARTICULARS MONTH YEAR

Permits and License 2,000.00
Electricity Bill 400.00 4,800.00
Water Bill 320.00 3,840.00
Rent Expense 1,000.00 12,000.00
Miscellaneous 100.00 1,200.00
Transportation 200.00 2,400.00
TOTAL ADMINISTRATIVE EXPENSE 2,020.00 26,240.00

PRE-OPERATING EXPENSE

PARTICULARS AMOUNT (One Year)

Fixed Capital Requirement 4,080.00
Supplies and Materials 391,280.00
Labor Requirement 57,600.00
Total 395,360.00

PROCESSING EXPENSE

PARTICULARS AMOUNT (One Year)

DIRECT COSTS
Direct Labor 33,600.00
Direct Materials 182,960.00
Utensils and Equipment 4,080.00
INDIRECT COST
Supplies 208,320.00
 Indirect Labor (Manager) 24,000.00
TOTAL PROCESSING EXPENSE 452,960.00

SOURCE OF FUNDS (Owner`s Equity)

PARTICULARS AMOUNT (Year)

Pre-Operating Expense 395,360.00

Processing Expense 452,960.00

Administrative Expense 26,240.00

Marketing Expense 2,750.00

Total 877,310.00

PROJECTED INCOME STATEMENT

PARTICULARS PRE-OPERATION YEAR 1

REVENUE
Cash Sales (PhP32.00 × 19,200 packs) -0- 614,400.00
Total Revenue -0- 614,400.00
EXPENSES
Pre-operating Expense 395,360.00
Processing Expense 452,960.00
Marketing Expense 2,750.00
Administrative Expense 26,240.00
Depreciation of Fixed Assets 622.00
Total Expenses 395,360.00 482,572.00
NET INCOME 131,828.00
Retained Earnings, Beginning
Retained Earnings, Ending 131,828.00

PROJECTED CASH FLOW STATEMENT

 PARTICULARS PRE-OPERATION YEAR 1
CASH FLOW

Beginning Cash Balance -0- 481,950.00

Loan Proceeds -0- -0-

Owner`s Equity 877,310.00 -0-

Cash Sales -0- 614,400.00

Add: Collection from Receivables -0- -0-

Total Cash Inflow 877,310.00 1,096,350.00

CASH OUTFLOW

Pre-operating Expense 395,360.00

Processing Expense 452,960.00

Marketing Expense 2,750.00

Administrative Expense 26,240.00

Total Cash Outflow 395,360.00 481,950.00

NET CASH FLOW 481,950.00 614,400.00

PROJECTED BALANCE SHEET STATEMENT

 PARTICULARS AMOUNT

ASSETS

Current Asset

Cash 614,400.00

Account Receivables -0-

Non-current Asset

Fixed Asset 4,080.00

Less: Depreciation Cost 622.00

Total Non-current Asset 3,458.00

TOTAL ASSETS 610,942.00

LIABILITIES

Current Liabilities -0-

Total Current Liabilities -0-

OWNER`S EQUITY

Capital 479,114.00

Retained Earnings, Beginning 131,828.00

Total Owner`s Equity 610,942.00

TOTAL LIABILITIES AND OWNER`S EQUITY 610,942.00

COMPUTING PRODUCT PRICE

Variable Cost per Unit= Projected Processing expense/Volume of Production
=PhP452,960.00/19,200 packs
= PHP23.59 or PhP24.00/pack
Computing Product price with mark-up:
Selling Price = Variable Cost per Unit/1- (desired mark-up percentage)
= PhP24.00/1-25%
= PhP24.00/.75
= PhP32.00
So, the selling price of the product is PhP32.00 per pack