FINANCIAL ASPECT OF

BUSINESS PLAN
 SALES PROJECTIONS
 A sales forecast is an estimate of what a
company will sell in a week, month, quarter
or year. It's used to predict future revenue,
accounting for the number of units an
individual, team or company is likely to sell
over a set period.
(Note: In sales projections, from the word itself
projections, meaning, you are just anticipating
possible sales or income for 5 years. You can do
this by the help of information gathered from
other competitors offering the same products.)
Notes:
*Qty./month means Quantity per Month.
*For year 1 computation of qty.:
Qty per month multiply 12 (no. of months in 1 year)
=150 x 12 = 1800
X 12
=
Formula used:
(Qty for Year 1 multiply the given percentage) plus
Qty. for Year 1 = Qty. for Year 2
= (1800 x .10) +1800
=180 + 1800
= 1980 Qty. for Year 2

*The increase of qty. per year from years 2-5, is 10%

X .10=180
+180
=
*For peso computation:
Qty. for Year = Qty. multiply by reseller price
=1800 x 31
=55,800 Price for year 1

*Do the same steps for Quantity Year 3-5.

X 31
=
FINANCIAL PLAN
A. START UP SUMMARY
 START UP SUMMARY
 includes the description of your products and
services, the structure of your business, your
target market, marketing strategy, funding
requirements, financial projections, and
licensing requirements, among others. It
serves as a roadmap for your business.
Notes:
*Total quantity per month is based from the
sales projection.
Notes:
*Add all the salaries of the employees to
get the Labor cost.
500 + 6,850 = 7,350
Labor Cost
Formula used:
*Cost/pc multiply to the total qty. per month
*Since every 1 yard of neoprene fabric can
make 10 masks, total qty. per month divide 10
is equal to 69. (685/10=68.5 round off)
=85 x 69
=5,865
X 69 =
For year 1:
*Total qty. per month multiply by 12 (except
for permits and license; and sewing machine
because they are not consumable)
=5,865 x 12
= 70,380

Do the same process to the succeeding data.

X 12 =
 FINANCIAL PROJECTION
 is a forecast of your company's future
financial performance. It should include line
items for each type of asset and liability, as
well as a total at the end.
 INCOME STATEMENT
 is a financial statement that shows you how
profitable your business will be within a
given period.
Note:
*Revenues from total sales projection table -
Year 1 Sales in Peso
Note:
*COST OF GOODS SOLD (from start-up summary
table), all the materials cost needed in production of
goods like fabric and labor.
70,380 + 88,200 = 158,500
Note:
*GROSS PROFIT is equal to Revenues less Cost of
Goods Sold.

REVENUE – COGS = GROSS PROFIT

290,280 – 158,580 = 131,700
Note:
*EXPENSES include all the expenses that are
not included in cost of goods sold like utilities,
miscellaneous expense and permit and licenses.
24,000 + 15,420 + 3, 000 = 42,420
Note:
*INCOME BEFORE INTEREST AND TAXES =
Gross profit - expenses.

GROSS PROFIT – EXPENSES = INCOME B4 INT AND TAX

131,700 – 42, 420 = 89, 280
Note:
*Tax = 32% (tax rate) of Income before Interest and
Taxes

Income before Interest and Taxes X 0.32 = TAX

89,280 X 0.32 = 28, 569. 6 (round-off)
28, 570
Note:
*NET INCOME = Income before Interest and
Tax less Tax
INCOME B4 INT AND TAX – TAX = NET
INCOME
89,280 – 58, 570 = 60, 710
To compute for years 2-5:
*Do the same procedure.
Note:
*Cost of goods sold and expenses multiply to the
desired percentage you want. In that projection, 10%
increase per year is used to get the amount for years
2-5 (except for permit and licenses).
 PROJECTED CASH FLOW
 is best defined as a listing of expected cash
inflows and outflows for an upcoming period
(usually a year). Anticipated cash
transactions are entered for the sub-period
they are expected to occur.
Note:
*CASH FLOW – this financial statement shows the
flow of cash (inflow and outflow).
*BEGINNING BALANCE for the year 1 is based
on start-up summary total qty, per month.
For the years 2-5, the ending cash balance of the
preceding year will be the beginning balance for the
current year.
Note:
*CASH SALES are based on the sales
projection table from the total sales in peso
per year.
Note:
*TOTAL CASH INFLOWS = Beginning
balance + cash sales plus + cash inflows

27,000 + 290,280 = 317,280

Note:
*Owner’s Withdrawal is projected amount only.
Note:
*Total Cash Outflows.
Materials 70,380
Machine 7,500
Labor 88,200
Utilities 24,000
Miscellaneous 15,420
Permit and License 3,000
Owner’s Withdrawal 28,570
Total 237,070
Note:
*ENDING CASH BALANCE = Total Cash
Inflows - Total Cash Outflows. E.g. in Year 1
=317,280 – 237,070
=80,210
 BALANCED SHEET
 the financial statement that reports a
company’s assets, liabilities, and owner’s
equity within a given period.
*Always remember that in Balanced Sheet the
Total Assets must be equal to Total Liabilities
and Equity.
Note:
*ASSETS AND LIABILITIES consist of
current and non-current.
*CURRENT ASSETS are cash and other assets
converted to cash within a year while NON-
CURRENT ASSETS are cash and other assets
that will not be realized or converted within a
year.
Note:
.*CURRENT LIABILITIES are liabilities
or short-term financial obligations that are
due within a year while NON-CURRENT
LIABILITIES are long-term financial
obligations that the due is more than a year.
Note:
*Cash at hand is based on Net Income.
*Income tax payable= 32% (tax rate) of Income before
interest and taxes.
*Capital is based on the cost per month in start-up
summary table.
*Drawings – total drawings for the period.
Note:
*NET CAPITAL = Capital Beginning +
Net Profit – Drawings
Note:
*TOTAL LIABILITIES AND EQUITY =
Total Liabilities + Net Capital