TITLE: BUSINESS PLAN

BUSINESS NAME: BENMOTO ELECTRICAL SUPPLIER.

PRESENTOR: BERNARD KIPRONO

COURSE CODE: 2601

CENTRE NAME: NİSHİKAM SAİNT PURAN SİGHN İNSTİTUTE

INDEX NUMBER: 5121060031

SUPERVISOR: JOSHUA MIRUKA

PRESENTED TO : THE KENYA NATIONAL EXAMINATION COUNCIL IN PARTIAL

FULFILMENT OF CERTIFICATE IN ELECTRICAL AND ELECTRONIC ENGINEERING.

SERIES: NOVEMBER 2022

i
 DECLARATİON
This project is my original copy which I am presenting to Kenya National Examination council without
referring from elsewhere.

Name: BERNARD KIPRONO

Signature:..................................Date...........................

Supervisor: Joshua

Signature:...................................Date..........................

ii
 DEDICATION

I dedicate this project to my entire family for their support .I really appreciate their sincere concern. I
sincerely wish to express my gratitude to all friends who gave their support and well wishes to
accomplish this task.

May God bless you abundantly.

iii
 ACKNOWLEDGEMENT
I wish to express my sincere gratitude to my parents , brothers and sisters for their moral support and
financial assistance they have given me throughout the research which had made me successfully in my
studies.
I also acknowledge my classmates for their help they have made on me and may they be blessed.
Finally I wish to thank all my friends and my supervisor MR. Benson Kipkirui for his genuine guidance
he gave me during the research exercise.

May God bless you all abundantly.

iv
Table of Contents
DECLARATİON.........................................................................................................................................................2
DEDICATION............................................................................................................................................................3
ACKNOWLEDGEMENT.............................................................................................................................................4
EXECUTIVE SUMMARY............................................................................................................................................5
1.0 Business Description.....................................................................................................................................5
2.0 Market plan...................................................................................................................................................5
3.0 Organization and Management....................................................................................................................5
4.0 OPERATIONAL PLANNING.............................................................................................................................5
5.0 Financial Plan................................................................................................................................................6
CHAPTER ONE.........................................................................................................................................................7
1.0 BACKGROUND OF THE OWNER.....................................................................................................................7
1.1 BUSINESS DESCRIPTION................................................................................................................................7
1.2 NAME OF THE BUSINESS...............................................................................................................................7
1.3 LOCATION AND ADDRESS..............................................................................................................................7
1.4 Ownership and Registration..........................................................................................................................8
1.5 Type of Business............................................................................................................................................8
1.6 Product and Services.....................................................................................................................................8
1.7 Industry.........................................................................................................................................................9
1.8 Justification of Opportunity........................................................................................................................10
1.9 Goals of The Business..................................................................................................................................10
1.10 Entry and Growth Strategy........................................................................................................................10
CHAPTER TWO......................................................................................................................................................12
2.0 MARKET PLAN.............................................................................................................................................12
2.1 Marketing Objectives..................................................................................................................................12
2.2 Customers...................................................................................................................................................12
2.1.1 INSTITUITIONAL....................................................................................................................................12
2.1.2 INDIVIDUAL..........................................................................................................................................12

v
 2.3 Market shares and segments......................................................................................................................13
2.4 Competitors................................................................................................................................................14
Strength.......................................................................................................................................................14
Weaknesses...............................................................................................................................................14
2.5 METHODS OF PROMOTION AND ADVERTISEMENTS...................................................................................14
2.6 Pricing Strategy...........................................................................................................................................15
2.7 Distribution strategy...................................................................................................................................15
2.8 Sales tactics.................................................................................................................................................15
2.9 DISTRIBUTIONPOLICY..................................................................................................................................15
CHAPTER THREE....................................................................................................................................................16
3.0 Organization and Management..................................................................................................................16
3.1 ORGANISATIONAL CHART...........................................................................................................................16
3.2 MANAGER PERSONEL................................................................................................................................16
ASSISTANTMANAGER.............................................................................................................................17
SALESREPRESENTATIVES....................................................................................................................17
CREW/CLEANER.........................................................................................................................................17
3.3 OTHER PERSONEL........................................................................................................................................17
3.4 Recruitment Training and selection............................................................................................................19
3.4.1RECRUITMENT....................................................................................................................................19
3.4.2TRAINING............................................................................................................................................19
3.4.3PROMOTION......................................................................................................................................19
3.5 Motivation...................................................................................................................................................20
3.6 Legal Requirement......................................................................................................................................20
3.7 Support Service...........................................................................................................................................21
CHAPTER FOUR.....................................................................................................................................................22
4.0 PRODUCTION/OPERATION PLAN................................................................................................................22
4.1Operation Facilities and Equipments...........................................................................................................22
4.2 FACILITY LAY OUT........................................................................................................................................23
4.3 Production Strategy....................................................................................................................................24
4.4 Production Process.....................................................................................................................................24
4.6 Regulation Affecting the business operation...............................................................................................25
CHAPTER FIVE.......................................................................................................................................................26
vi
5.0 FINANCIAL PLAN..........................................................................................................................................26
5.1Pre- Operational Costs.................................................................................................................................26
5.2 Estimation of Working Capital.....................................................................................................................27
5.3 Cash Flow....................................................................................................................................................27
5.4 Proforma Income Statements.....................................................................................................................28
5.5 Balance Sheet..............................................................................................................................................30
5.6 BREAK EVEN POINT.....................................................................................................................................31

vii
 EXECUTIVE SUMMARY
It describes the following;

1.0 Business Description.

The business will be called BENMOTO ELECTRICAL SUPPLIER
It will be a sole proprietorship type of business dealing with electrical equipment.
It will be located along Kapkatet-kapletundo road bureti sub county kericho County.
To contact the premises
BRIMOTO ELECTRICAL SUPPLIER
P.O BOX 324
Kericho
TEL.NO 0717171704

2.0 Market plan

The potential customers of the business are domestic customers and industrial customers.
Also will supply hospitals and local polytechnic like Bureti.
The business will capture market share size of 40% of customers per year out of population of 45000
people
The business will be giving services to customers directly. Also it will be advertising through posters
and radios.

3.0 Organization and Management

The business will be managed by a manager and assistant manager. The owner will use his knowledge
which he has acquired from the course while assistant manager will directly be answerable to the
manager of all the enterprise matters.

viii
4.0 OPERATIONAL PLANNING
The operation process of the business shall be effective in order to run its daily activities effectively.
Trained and qualified People shall be employed to provide appropriate operation. The daily basis
operation of which all workers shall have to comply and strictly follow are;
- The working hours after lunch shall extend until 5.30pm when the business shall be closed.
- All employees shall have to be on duty exactly 8.00am in the morning.
- The manager shall allow his employees to attend seminars and tours in relation to their
department .The gained knowledge shall be used to improve the business

5.0 Financial Plan.

The business will obtain capital from personal savings, lending institutions. borrowing from friends and
inheritance
In which current assets will be Kshs198460 and current liabilities Ksh73900 capital will be 272360

ix
 CHAPTER ONE

1.0 BACKGROUND OF THE OWNER

The owner of the business is called Bernard kiprono age 22years who comes from kericho county bureti
sub county. He is a diploma holder

1.1 BUSINESS DESCRIPTION

Business will be a sole proprietorship.The manager will be the owner of the business.The business will
employ four people; the manager,the sales person,secretary and one cleaner. The target of the business
will be colleges,universities ,government department and the residents around the area.Aim of the
business will be;increasing number of customers,offering quality products,expansion of customers and
increasing sales.

1.2 NAME OF THE BUSINESS

Name of the business will be BENMOTO ELECTRICAL. The name comes from the name of the
owner called bernard. It all starts after the owner realize to start a business. The business will deal with
electrical appliances either small or large equipments associated with electrical work. The appearance
of the name indicate to many as newly set up ELECTRİCAL within the locality and easy to memorise.

1.3 LOCATION AND ADDRESS

BENMOTO electrical supplier will be situated along Kapkatet - Kapletundo, bureti sub-county, kericho
county. The box number is 324 litein and the telephone number is0717171704i.e
BERNARD ELECTRICAL
P.O.BOX 324
Kericho
TEL.No.0717171704.

1
 Kapkatet

2 km ben moto shop

sotik

The location has high demand and and good security

1.4 Ownership and Registration

Benmoto electrical supplier will be a sole proprietorship type of business which will be owned and
managed by Bernard as the managing director. The business shall be registered by the county council of
Kericho county and proven by Kenya Bureau of standards by selling quality electrical equipment and
licence.

1.5 Type of Business

Business will deal with both retail and wholesales equipments associated with electrical only.

1.6 Product and Services

Business will deal with the selling of the following products:
Produce Quantity Price
One gang one wayswitch 23 5000
One gang two way switch 43 20000
Two gang two way switches 32 12000
Double way socket 46 30000

2
 Types of Switches
One gang one way switches 18 9000
One gang two way switches 23 12000
Two gang two way switches 17 17000
Types of sockets
Double way sockets 40 13000
Single way sockets 16 23000
Types of Lamps
Sodium vapour lamps 6 19000
Mercury vapour lamps 4 17500
Fluorescent lamp 10 15000
Types of Cables and their Sizes
1.5mm2( live neutral earth) single core. 2 7000
2.5mm2(live neutral earth) single core. 4 10000
1.5mm2(live neutral earth) sheathed 6 12000
2.5mm2( live neutral earth) sheathed 4 20000
10mm2 single core 7 18000
Lamp holders 100 9000
Motors 5 15000
Generators 6 60000
Bulbs 15 10000
Electrical bells 7 25000

The business will service some machines like motors,generators etc. which will be sold to customers.

1.7 Industry
The business fall under industrial product where it offers quality services as they are given by the
manufacturer.
The industry assembling electrical accessories will be medium in size.This will be due to their
capacities.

3
The employees who will be working at BENMOTO Electrical Shop are the one who shall be well
skilled and have attained the required grade and qualified to be an electrician.

1.8 Justification of Opportunity

The owner decided to start the business because of ready market and the source of income which will
be very high.Due to high demand of electrical accessories, many peaple from entire area shall come to
buy products from the same electronic.

1.9 Goals of The Business

The aim of the business will be to create market.This will be done by expanding the enterprise,opening
up some branches and improving the economy of the area by creating employment to the surrounding
customers.
The business will aim at selling high quality accessories at reasonable prices.The business will offer
welfare to employees,it will supply goods and services of high quality such that to satisfy their wants.
The business will ensure continuous supply of the products so as to meet the customers' requirements.
Business will work with the government in formulating the policies in the society.

1.10 Entry and Growth Strategy

Benmoto electrical and electronics intends to venture into the business by November 2022 through the
following steps:
- Should employ the required number of employees
- Should hire the building
- Should purchase the required tools and equipments
- Should be registered and this can be proven by having a licence
Public awarenes of Benmotoelectrical and electronics will be done through posters,advertisement
through radios, magazines and televisions.

4
The arrangement will be made between the landlord and the owner of BENMOTO electrical and
electronics. There will be advertisement through radios,posters all over Kericho region and the
newspaper.The employees will be interviewed and recruited.

There will be 6 discount on goods and services worth two thousand shillings and above, 3 discount on
goods worth six hundred shillings and above.
The business requires to be advertised for public or customers awarenes. This can be done through
mass media, written billboards and launching of a ceremony. During launching, some hand- out inform
of posters should be given as means of communication to far away customers.

When the business matures, it makes more profit which enable opening of many branches and get
known all over as one of the most reliable electrical shop countrywide thus gaining customers'
confidence all over.

5
 CHAPTER TWO

2.0 MARKET PLAN

It will enable one to do a market research on the challenges that the customers are likely to face,then
he /she can develop marketing strategy and tactics required to exploit them hence in order to venture
into business and good future through having a market plan.

2.1 Marketing Objectives

This is the aim of a seller in a business.It will enable one to look into various ways in order to come up
with a good objective which will enable him to succeed on it by;

i) Market shares
The business will run for at least 46% depending on the surrounding customers and this will enable
him/her to prosper to other various parts in the area.

ii) Sales turn over

For the first year Brimoto electrical will realize a turnover of1.4 million and this will be due to supply
of commidities with high quality and quantity to various area.

2.2 Customers
2.1.1 INSTITUITIONAL
Benmoto electrical and electronics will supply its materials to various customers.These are;
i)Hospitals eg Kisii level Six Hospital,kapletundo dispensary etc.
ii)Local polytechnics eg bureti polytechnic.

6
2.1.2 INDIVIDUAL
Calcare electricals just within the shop
Benmoto electrical will use the following tactics to beat his customers;
a)Give service to customers as the first priority.
b)Taking the materials to customers regularly at agreed time.
c)Selling the materials at reasonable price to retain and attract more customers.

2.3 Market shares and segments

The business depend on the various customers whereby it will have commercial and industrial
customers. with the number of technicians who will buy from this shop most of them being of middle
age between 22- 36 years and most of them are from jua kali sectors.

Competitors expectednumberofcustomers Marketshares

Names Population Percentage%

Westside electricals 30,000 25

Nilcon electricals 20,000 15

Lightning electricals 35,000 20

Others 45,000 40

7
 25

40

15

20

westside nilcon lightning 4th Qtr

2.4 Competitors
Before starting the business,we have come up with the ways of defeating our competitors in the
market.The main competition Eterprises are;
i)Westside electrical
ii)Nilcon electrical
iii)Lightning electrical

Strength
a) will offer transportation facilities to customers
b) will supply materials at required time
c) will sell goods and services of high and modern quality.

Weaknesses
(a) Lackofadequatemanagerialskills
(b) Lackofmoderntechnologyleadingtodelayinproduction
(c) Exorbitantprices

8
2.5 METHODS OF PROMOTION AND ADVERTISEMENTS
The business will use promotional and advertising methods to increase its
sales.Thebusinesswillallowandofferdiscountstothecustomerswhopurchaseinlargequantities.Thebusine
sswillalsoofferfreesamplesduringthefirstweekofitsoperation.Themethodofadvertisingproductswillincl
ude.

(i) Posters – they shall be well designed printed and stuck on walls of buildings where
people find access through example outside shops, on street along path and road
function.
(ii) The Radio– this will be done over the popular radio station like kitwek FM and KBC
RadioTaifa FM reaches majority of the people in the area.
(iii) Free samples – customers will be given free samples so as to build trust to the
products

2.6 Pricing Strategy

Benmoto electrical and electronics on the price of competitors will enable enterprise to fix its price. The
law of demand and its substitutes determine the price of materials in the enterprise.

2.7 Distribution strategy

The business will use its motor vehicle and motor cycle to transport and distribute the electrical
materials to the customers in order to avail the materials at required time.Other materials will be sold to
customers in small quantities.

2.8 Sales tactics

The business will employ the following tactics to sell its products and factorise the customers;
- it will employ sales man to sell materials to the most needed product by the market share and to an
effort of having a stock of it.
- it will have the workers who are well groomed and they shall be in uniform at all working hours and
these uniforms shallowly have abatch on it to indicate the section each and every worker will be
playing.

9
2.9 DISTRIBUTIONPOLICY
Theproductswillbe distributedthroughthefollowingchannels

(a) Directlytothecustomersthatisproducer consumer

(b) Producer wholesalers Retailer consumer

(c) Producer Retailer Institution

Theproductswillbetransportedbyroadtransport.Thereisbecausetheareahasa
network of tarmac road.This transport will involve both strollers for short distancesand vehicles to
consumers far away. The cost of transporting will be Kshs.19, 000 permonth.Transportation of the
productswill face various difficulties due to the delayscaused by inadequate means of transport but the
entrepreneur will expand the meansbypurchasingmorevehicletocopeupwiththesetransportproblem

10
 CHAPTER THREE

3.0 Organization and Management

Organization
This is the collection of people joined together in same formal association to achieve group objective.

Management
This the coordination of human material resources to accomplish an objective

3.1 ORGANISATIONAL CHART

Manager

Supervisor Accountant Marketer

3.2 MANAGER PERSONEL

Management objectives are;
i) to expand the business
 HigherDiplomainBusinessmanagement
 DiplomainAccountancy
 Computerliterate
 Shouldbeabletogetalongwithallpeople
 Be26yearsandabove

11
 ASSISTANTMANAGER

 Diplomainpurchasingandsupplies
 Goodcommunicationskills
 Computerskills
 Twoyearsexperienceandabove23years

SALESREPRESENTATIVES

 AtleastadiplomainSalesandmarketing
 Adrivinglicensewithoneyearexperienced
 Goodcommunicationskills
 Abovetheage25
 Computerliterate

CREW/CLEANER

 Self-efficient
 KCSEResults
 CertificateofGoodconduct
I]Keentothedetails
ii)to improve knowledge and skills of recording by attending seminars
iii) to supply the best quality material in various areas

3.3 OTHER PERSONEL

Personel No. qualifications duties
Service man 2 Diploma holder Serving customers
Good selling skills
Watchman 1 Must be above 25 Report any insecurity
years or complains to the
company
Driver 2 Must be above 30 Transport goods
years

12
The business will be managed by manager and assisted by the assistant manager.The owner will use his
knowledge who he has acquired from the course.Assistant manager will directly be answerable to the
general manager of the all enterprise matters concerning the management of the business.

Manager curriculum vitae

Name: Bernard kiprono

Marital Status: Single

Denomination: Christian

Address: P.O. BOX 324 kericho

2019- 2022: Kenya certificate of electrical engineering coures.

2013- 2017: Kenya certificate of secondary education at Kamungei High School

2006- 2012: Kenya certificate of primary education at kapkoitim primary school

Manager duties
- Decision makers
- Business representation
- Business negotiation

Assistant Manager
Qualification;
Diploma in Business Administration
Duties;
- Controlling office facilities
- Supervising the staff
- Maintaining administration recordsrecords
13
Account Clerk
Qualification
A holder of KATC from the recognized instutution
Duties
- To pay workers
- Preparing and writing accounts statements
- Preparing the cheques.

3.4 Recruitment Training and selection

3.4.1RECRUITMENT
The business will post an advert for vacant post over the radio and posters.The
entrepreneur will also ensure that announcement of vacant post aremade in social
gathering around the area like cinema and market centerschurches.Application for the
post will be done in the business where
thenamesofapplicantwillbeshortlisted.Theshortlistednamesoftheapplicantwillbecalledf
oraninterviewinthebusiness.Thebestintervieweeswill be offered the job posts.
Orientation of the new employees will be done by the manager and other old are
employees.

3.4.2TRAINING
The employees and staff will acquire skills to improve their performance from jobtraining,
attending seminar and from industrial attachments which will assist themimprovetheir
efficiency.

3.4.3PROMOTION
“SUPER-SWEET CAKES BAKERS will give a promotion policy based on experience,
hardworking, loyalty and family link.Also those employees with good
performanceovergivenyearsconsecutivelywillinaproperpositiongetapromotion

RENUMERAITONANDINCENTIVES

Theentrepreneurwillmotivatetheemployeesbygivingrightsandprivilegetoparticipate in decision
making.In order to ensure that they work under low
14
 supervisiontheentrepreneurwillgiveoutincentivestothebestperformingemployees.Theemployeeswi
llalsoreceivepaymentforthenumberovertimehourstheyworkinthe business
REMUNERATION
N O P O S I T I O N NO OFF SALARY PM(KSHS) SALARY PM(KSHS)

• C a s h i e r 1 3 0 , 0 0 0 3 6 0 , 0 0 0

• M a n a g e r 1 5 0 , 0 0 0 6 0 0 , 0 0 0

• Human resource 2 4 0 , 0 0 0 4 8 0 , 0 0 0

• A c c o u n t a n t 2 5 0 , 0 0 0 6 0 0 , 0 0 0

• Technical personnel 1 3 0 , 0 0 0 3 6 0 , 0 0 0

• S a l e s p e r s o n 1 7 , 0 0 0 8 4 , 0 0 0

• W a t c h m a n 5 2 5 , 0 0 0 3 0 0 , 0 0 0

• S t o r e k e e p e r 3 1 5 , 0 0 0 1 8 0 , 0 0 0

• C l e a n e r 4 2 4 , 0 0 0 2 8 8 , 0 0 0

• T e c h n i c i a n 1 2 5 , 0 0 0 3 0 0 , 0 0 0

T O T A L 2 1 2 9 6 , 0 0 0 3,552,000

3.5 Motivation
The business will give incentive to motivate the employees such as yearly bonus, they will be provided
with lunch,house and medical allowances at every month.All these will be done to motivate their
morale and also the manager and others will adopt respect to all employees' recognition of individual
workers and making decision to employees

3.6 Legal Requirement

The business will require trading license from the government trading office at Kshs 6000 and the
workshop permit from county council at Kshs 5000.

15
3.7 Support Service
The supply will get various support enterprise to assist the workshop to achieve their objectives support
services include:

Bank
The business will require the services of cooperative bank of Kenya in borrowing money for long term
and short term loans whenever there is financial need.

Coopetative Bank

Kisii branch

P.O.BOX 35820

Kisii

Insurance Company

The investor will ensure the business is insured against various risks which may arise within the
business such as at break of fire, theft, road accident during transportation.

LIDO Insurance Company

P.O.BOX 31003

NAKURU

16
 CHAPTER FOUR

4.0 PRODUCTION/OPERATION PLAN

The operation process of the business shall be effective in order to run it's daily activities
effectively. Trained and qualified personels shall be employed to provide approptiateopetation .
The daily basis operation of which all workers shall have to comply and strickly follow are;
- The working hours after lunch shall extend until 5.30pm when the business shall be closed.
- All employees shall have to be on duty exactly8.00am in the morning .
- The manager shall allow his employees to attend seminars and tours in relation to their
department .The gained knowledge shall be used to improve the business.

4.1Operation Facilities and Equipments

The eterprise will hire some equipments and at the same time purchase those which are essential
for smooth and effective operation of the business.
NO FACILITY DESCRIPTION PURPOSE SUPPLIERS OWNERSHIP QUANTITY UNIT TOTAL

1 C C U 4 way with circuit breaker Control the power L Y R O w n e d 1 0 0 2,500 250,000

2 Steel rule Standard Drawing in cable P A M A O w n e d 5 0 2 0 0 10,000

3 Computer P e r m a n e n t Keeping the record of the products and the names of employe s P A M A H i r e d 1 2 65,000 780,000

4 Meter box Standard To show the 562amount of power consumed Jua kali o w n e d 1 2 0 5 0 0 60,000

Industry

5 Pvc cable Standard Current to pass through them SONEX o w n e d 5 6 2 5600 314,7200

17
 6 . switch Standard To control the installation o w n e d 1 2 0 3 0 0 36,000

Power Max

The business will offer free transportation to the customers who buy goods in bulk.

4.2 FACILITY LAY OUT

SECURITY

BENMOTO SHOP

18
 CASHIER
MANAGER

ACCOUNTS
STORE

TOILETS BATHROOM

4.3 Production Strategy

Business will use the following strategies in order to realize high profit and minimize operation
costs;
a) Product Quality- Business will be supplying quality products and services so that to gain
customers' confidence and hence attract more customers.
b)Attraction strategies will also be in use, to attract more customers to the excellent
communication skills and who have capability to develop and maintain good customer relations
c) Timing strategy- enterprisewill be buying products from manufacturers at timely
intervals,such products are gotten when the demand is low hence prices are low and when it
comes on high demand, they will sell them at a higher profit margin.

4.4 Production Process

After making identification, manufacturer to supply theeterprise with the priducts, the accounting
will place orders for particular products either by personal contacts or sending the orders.Then
the accountant will make necessary arrangments for payment terms.

4.5 Other Expenses

N O D E S C R I P T I O N M O N T H L Y Y E A R L Y

19
 1 . E l e c t r i c i t y 1 , 5 0 0 1 8 , 0 0 0

2 . W a t e r 1 , 0 0 0 1 2 , 0 0 0

3 . L i n c e s e 3 , 0 0 0 3 6 , 0 0 0

4 . I n s u r a n c e 5 0 0 6 , 0 0 0

5 . T r a n s p o r t 2 , 5 0 0 3 0 , 0 0 0

6 . A d v e r t i s e m e n t 1 , 5 0 0 1 8 , 0 0 0

7 . S a l a r i e s 2 5 , 0 0 0

8 . R e n t 1 5 , 0 0 0

4.6 Regulation Affecting the business operation

Licenses
This an operation document which allows the business operetion and is from the local authority
under local government.It gives freedom for one to carry out a business and is obtained from the
county council under the local government.

Laws
All rules and regulation should be adhered to the act of Kenya law governs every employers and
employees to the company
Safety Regulations
For provision of safety the staff to the eterprise dust coats and gloves shall be provided to use
when handling sharp appliances which are dangerous.

20
 CHAPTER FIVE

5.0 FINANCIAL PLAN

The business capital will be obtained from personelsavings ,lendinginstitutions,borrowing from

friends and from inheritanc

5.1Pre- Operational Costs

I T E M S COSTS - KSHS. PER MONTH

O p e n i n g s t o c k 5 0 , 0 0 0

L a b o u r 4 0 , 0 0 0

P r e m i s e s 2 8 , 0 0 0

R e n t 1 5 , 0 0 0

S a l a r i e s 3 0 , 0 0 0

T r a n s p o r t e x p e n s e s 2 , 5 0 0

R e p a i r a n d m a i n t a i n c e 1 , 5 0 0

A d v e r t i s e m e n t 1 , 5 0 0

21
 E l e c t r i c i c t y 1 , 5 0 0

W a t e r 1 , 2 0 0

L i n c e n s e 3 , 0 0 0

5.2 Estimation of Working Capital

Working capital is the difference between the current assets and the current liability

C U R R E N T A M O U N T CURRENT LIABILITES AMOUNT (KSH)

Pre-paid rent 4 , 0 0 0 1 y e a r l o a n 2 0 , 0 0 0

D e b t o r s 1 6 , 6 0 0 C r e d i t o r s 1 5 , 4 0 0

Cash i n ha n d 4 5 , 5 0 0 R e n t 4 , 0 0 0

S t o c k 8 5 , 5 6 0 S a l a r i e s 3 4 , 5 0 0

T O T A L 1 9 , 8 4 6 0 7 3 , 9 0 0

WORKING CAPITAL =current assets- current liabilities

= 198460 – 73900
= 124560

5.3 Cash Flow

Benmoto Electrical and Electronics Cash Flow Project for the year 2022
P E R I O D J A N F E B M A R C H A P R M A Y J U N E NOVEMBER A U G S

22
CASH IN FLOW

Opening balance 657730 743237 772687 8 6 3 4 3 7 1 0 8 4 9 3 7 1 9 0 5 0 320250 4 2 2 2 7 0 6 9

Cash at bank 8 9 0 0 0 5 0 0 0 0 7 0 0 0 0 9 0 5 0 0 1 1 0 5 0 0 9 0 3 0 0 90000 9 5 0 0 0 8 9

CASH AT HAND 1 5 0 1 5 2 5 0 0 0 3 0 0 0 0 6 0 0 0 0 5 0 5 0 0 6 0 2 0 0 72750 7 7 7 7 0 7 9

C A P I T A L - - - - - - - - -

D e b t o r s - - - - - - - - -

S A L E ( C A S H ) 347500 300000 285000 2 7 5 0 0 0 2 5 0 0 0 0 1 0 5 0 0 0 235000 2 5 5 0 0 0 9 0

SALES(CREDIT) 5 2 3 0 0 7 9 5 0 0 6 9 5 0 0 7 5 0 0 0 100000 1005000 98000 9 2 5 0 0 9 3

TOTALCASH FLOW 1 1 6 1 5 4 5 7 1 9 7 7 3 7 1 2 2 7 1 8 7 1 3 6 3 9 3 7 3 5 0 0 0 0 6 2 5 5 5 0 816000 1 0 4 8 2 4 5 1 0

CASH OUTFLOW - - - - - - - - -

CASH PURCHASE 201000 210000 155500 1 3 0 0 0 0 1 4 5 0 0 0 1 3 8 0 0 0 125000 1 8 0 0 0 0 1 8

CREDIT PURCHASE 1 5 9 4 0 0 1 5 0 0 0 0 7 0 0 0 0 8 5 0 0 0 1 2 0 0 0 0 1 0 0 0 0 0 98000 1 0 8 5 5 0 7 0

ELECTRICITY 9 3 5 0 8 0 5 0 8 2 5 0 1 0 5 0 0 9 4 5 0 1 0 8 0 0 8025 6 0 0 0 6 0

S A L A R I E S 5 0 0 0 0 5 0 0 0 0 5 0 0 0 0 5 0 0 0 0 5 0 0 0 0 5 0 0 0 0 50000 5 0 0 0 0 5 0

INSULARANCE 5 7 0 0 - 3 0 0 0 3 0 0 0 3 0 0 0 3 0 0 0 3000 3 0 0 0 3 0

W A T E R 6 0 0 8 6 0 0 0 3 0 0 0 5 0 0 3 5 0 0 3 5 0 0 4000 4 5 3 5 3 0

Total c. out.flow 431458 425050 363750 2 7 9 0 0 0 3 3 0 9 5 0 3 0 5 3 0 0 288025 3 5 2 0 8 5 3 1

N e t c a s h 730087 772687 863437 1 0 8 4 9 7 1 9 0 5 0 3 2 0 2 5 0 527975 6 9 6 1 6 0 7 3

CASH CARRIED FORWARD 730087 772687 862437 1 0 8 4 9 7 1 9 0 5 0 3 2 0 2 5 0 527975 6 9 6 1 6 0 7 3

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5.4 Proforma Income Statements
Benmoto electrical and electronics and Services proforma Trading and Loss Account as
at31stDec 2018
C R K S H S . D R K S H

Purchase credit 7 2 5 , 0 0 0 S a l e s c r e d i t 6 8 3 , 0 0

Purchase cash 1 , 8 1 0 , 0 0 0 S a l e s c a s h 1 , 3 5 3 , 0 0 0

2 , 5 3 5 , 0 0 0 N e t s a l e s 2 , 0 3 6 , 0 0 0

Less closing stock 1 , 1 7 0 , 0 0 0

Cost of goods sold

GROSS PROFIT

N e t s a l e s
2 , 0 3 6 , 0 0 0
Cost of goods sold

Gross profit
1 , 3 6 5 , 0 0 0

T O T A L 6 7 1 , 0 0 0

E X P E N S E S 2 , 0 3 6 , 0 0 0

E l e c t r i c i t y 2 , 0 3 6 , 0 0 0

W a t e r 6 7 1 , 0 0 0 `

L i c e n s e TOTAL GROSS PROFIT

2 6 , 0 0 0
T O T A L 5 , 5 2 0

Gross profit –expenses = net profit 4 , 0 0 0

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 3 5 , 5 2 0 ,

6 3 5 , 4 8 0

5.5 Balance Sheet

Brimoto electrical and electronics Balance Sheet as at November 2018
A S S E T S L I A B I L I T I E S

F I X E D A S S E T S L O N G T E R M L I A B I L I T I E S

Furniture and fittings 2203 0 Initial capital 50000 0

Machinery 69210 Net profit 124560

TOTAL 91240 Total 624560

Drawings 52990

C U R R E N T A S S E T S Net capital 571570

Stock 267500 SHORT TERM LIABILITIES

Cash in hand 180000 Bank loan 20000

Cash at bank 450000 Creditor 8900

TOTAL SUM OF ASSETS 897500 Total 28900

Total liabilities 600470

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 Owner’s equity 388270

Total sum of liabilities 988740

5.6 BREAK EVEN POINT

VARIABLE COST KSH.
Telephone 12510
Electricity 33530
Water 17710
Transport 20390
Renovations 23700
Miscellaneous 106270
Total 235280

FIXED COST KSH

Loan repayment 20000
Salaries and wages 420300
Rent 53000
Insurance 62000
Taxes 13900
Total 569200

Total sales per year :Ksh 2195460

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