Angela Roquero

CHAPTER VI FINANCIAL ASPECT . This chapter examines the financial components of the proposed business, as well as its planned structure and performance, which are critical in evaluating the business's feasibility, profitability, and ability to generate profit and a fair return on investment. Investment Cost The prospective business could not commence operations without the owner's initial investment. The whole amount of operational cash required for the anticipated business's start-up investment will be capitalized at 1,000,000. This investment in a business venture could result in earnings and projected cash inflows over time. Table below shows the total amount of investment for the proposed business. Table 19. Investment Cost Particulars Cost Operation Equipment Materials 146,500.00 Furniture and Fixture 95,628.00 Supplies Expense 57,239.00 Rent 120,000.00 Pre-Operating Expense 71,700.00 Cash Beginning (WC) 165,500.00 Total Cost 656,567.00 Financial Forecast and Assumptions Financial assumptions are necessary for a complete understanding of the financial feasibility of the proposed business. This will provide a clear view of financial data and figures. Result of the assumption serves as the basis of financial planning that drives growth and creates efficient operations. These conclusions are based on accurate estimation and evidence. The following are the financial assumptions of the proposed business clustered according to its categories. The total projected cost of P 656,567.00 will be acquired through commercial banks during the business’ stage of financing. Funds that will be collected from or borrowed from the financial institutions will be used mainly by the chief operating officer for the start-up operations such as legal fees, acquisition of tools and equipment, beautification of the rented office, cost of advertising, training and for pre-opening capital of the business. . Statement of Income Assumptions ● Accrual basis of accounting will be used. ● Revenues are assumed to increase by 3% per annum. ● Office Supplies are all expensed at the end of the year. ● The rate charged to the computation of water and electric consumption is based on the Electric and Water District’s current rate. Schedules The tables on the nest page are the formulated schedules for the proposed business. Schedule 1 Products Products Offered Prices Number of products/month Monthly Income Annual Income Clothes Round neck tops (t- shirt-,-,800.00 Basic ribbed t-shirt-,-,600.00 Ribbed polo top-,-,200.00 Korean long sleeves bow top-,-,600.00 Square neck ribbed tank top-,-,400.00 Linen backless dress-,-,200.00 Side string ruched dress-,-,600.00 Korean bodycon fitted dress-,-,600.00 Korean sexy bow tie top-,-,600.00 Zara ruffled ruched croptop-,-,800.00 Men’s polo shirt ₱-,-,800.00 Bomber jacket for men ₱-,-,800.00 Korean pullover sweaters ₱-,-,200.00 Regular fit round neck ₱-,-,600.00 Short sleeve t-shirt for men ₱-,-,400.00 Shoes Luckiss Korean rubber shoes for women-,-,800.00 Women’s rubber breathable sneakers-,-,200.00 Women’s walking shoes-,-,400.00 Korean casual shoes (sneakers-,-,200.00 Wild student running shoes-,-,400.00 Thick-soled white shoes-,-,400.00 Low cut sneaker rubber shoes-,-,400.00 Comfortable rubber shoes for men-,-,000.00 Fashion sneakers for men-,-,200.00 Resistant rubber sports shoes-,-,400.00 Men’s rubber sneaker shoes-,-,400.00 Cosmetics Lipstick blush makeup set-,-,400.00 Dual ended lipstick-,-,400.00 Eye makeup set-,-,000.00 COD NUDE 18 color eye shadow-,-,000.00 Waterproof eyebrow pencil-,-,000.00 2 in 1 liquid eyeliner-,-,400.00 Summer girl clay blush-,-,600.00 Setting powder-,-,800.00 Total 620,050.00 7,440,600.00 Schedule 2 Equipment Particulars Quantity Price Total Cost Computer 1 20,-,000.00 Laptop 1 38,-,990.00 Smartphone 2 10,-,000.00 DSLR Camera 1 30,-,000.00 Stand fan 1 1,619.75 1,619.75 Steam iron/Clothes steamer 2 1,560.00 3,120.00 Printer 1 9,000.00 9,000.00 Total 111,-,729.75 Schedule 3 Furniture & Fixtures Particulars Quantity Price Total Cost Office table 1 4,850.00 4,850.00 Chair 1 4,000.00 4,000.00 Clothing display rack 5 4,-,600.00 Sofa 1 15,-,899.00 Storage cabinet 3 4,-,685.00 Shelf 3 4,-,485.00 Total 38,-,519.00 Schedule 4 Advertising Expense Particulars Annual Cost Flyers (100 pcs × ₱4.00 ) 400.00 Social Media Platforms (Facebook) 8,000.00 Total 8,400.00 Schedule 5 Utilities Expense Particulars Cost/Month Annual Cost PLDT 2,-,000.00 Electricity 4,-,000.00 Water 200.00 2,400.00 Total 5,-,400.00 Schedule 6 Rent Expense Particulars Monthly Cost Annual Cost Rent 3,-,000.00 Total 42,000.00 Schedule 7 Office Supplies Expense Particulars Quantity Price Total Cost Ballpen- Marker- Stapler- Bullet stapler- Scissor- Long bond paper- Short bond paper- Ink-,000.00 Paper bags-,500.00 Adhesive tapes- Total 1,497.75 8,237.25 Other Supplies Expense Particulars Quantity Price Total Cost Trash bin- Mop- Broom- Dust pan- Light bulb- Hanger-,000.00 Fire extinguisher 1 2,000.00 2,000.00 Mannequin 2 3,500.00 7,000.00 Mirror 2 2,000.00 4,000.00 Total 7,-,891.50 Schedule 8 Permits & Licenses Particulars Annual Cost Business Location Clearance 3,000.00 Fire Safety Clearance 5,000.00 Preparations and Printing of Plans 40,000.00 Civil Engineer's Fee for supervision 1,000.00 Building Permit Fee 10,000.00 Cenro 500.00 Business Tax 2,000.00 Barangay Clearance 100.00 Permit Tax 500.00 Garbage Collection Fee 200.00 Total 62,300.00 Schedule 9 Project Cost Expense Particulars Cost Estimated Useful Life Depreciation Leasehold Improvement 760,- years 19,000.00 Total 19,000.00 Schedule 10 Depreciation of Machinery and Equipment Equipment Quantity Cost Estimated Useful Life Depreciation Computer 1 20,000.00 5 years 4,000.00 Laptop 1 38,990.00 5 years 7,798.00 Smartphone 2 20,000.00 3 years 6,666.67 DSLR Camera 1 30,000.00 5 years 6,000.00 Stand fan 1 1,619.75 3 years 540.00 Steam iron/Clothes steamer 2 3,120.00 3 years 1,040.00 Printer 1 9,000.00 5 years 1,800.00 Total 122,729.75 27,844.67 Schedule 11 Depreciation of Furniture & Fixtures Furniture & Fixtures Quantity Cost Estimated Useful Life Depreciation Office table 1 4,850.00 7 years 692.86 Chair 1 4,000.00 5 years 800.00 Clothing display rack 5 22,600.00 5 years 4,520.00 Sofa 1 15,899.00 6 years 2,650.00 Storage cabinet 3 14,685.00 7 years 2,098.00 Shelf 3 13,485.00 5 years 2,697.00 Total 75,519.00 13,457.86 Schedule 12 Total Depreciation Particulars Depreciation Equipment 27,844.67 Furniture & Fixtures 13,457.86 Project Cost 19,000.00 Total 60,342.53