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Name Matirc No.

Woon Hock Chuan 163017707

Programme: Bachelor in Civil Engineering


Subject: Fundamental Accounting & Finance
Task: Assignment 2
Date: 04 05 2017
Lecturer: MUHAMAD AZANI YAHYA
Assignment 2

Question: Individual Assignment (10%) You planned to open up a business


using the capital of RM 100,000. The aim is to generate the profit at least 30%
in 12 months. Simulate the business plan to show the financial planning for that
particular aim.

Introduction

This is an assignment given and guided by our lecturer which is MUHAMAD


AZANI YAHYA on managing a business to have at least 30% profit within 12
month time. This assignment will be focusing on creating a business and to earn
as much profit in the given time. Financial Planning of the business model will
be prepared and estimate the profit and loss along with tables and graph
calculations.

Business model

Name of Registered Business: Hard Stone Cements Trading

Company Main Business: Cement Supplier

Authorized Capital: Rm 100,000.00

Number of Employees :5

Employees Structure:

1. Accountant:1

2. Supervisor:1

3. Hard Labour :2

4. Sales Man:1
Income Source

-Our company goal is to retrieve as much profit as we can through multiple streams of
income. Below are the sources of income for our company.

1. Cement Supplying

-Factory price of rm10 per 50kg bag of cement for supply and distributing.

-Price of rm20 will be sold which is lower than competitor price ranged Rm 22

2. Renovation

- 20% of the goods will be used for renovation or small projects such as flooring and
concrete works. That will yield min Rm12,000 every 3 month of a project.
3. Investments

-20% of the capital will be placed into investment that would generate approximately
50% per annum. Below are two example of investments being placed.

Stock Markets trading.

Agencies for Employment services.

Profit and Loss Calculation

Start up cost & profit spending

Capital: Rm 100,000.00

Company legalization: -Rm 1000

Rental and utilities: Rm 1500 x 12 = -Rm 18,000

Labour Fees: Rm 10,000 x 12 = -Rm 120,000

Investment: -Rm 20,000

Renovation works: -Rm 9,000 for tiles and equipment cost

Cement Supplies: -Rm 40,000 (4000 bags of cement) + Rm 55,100 (after 6 months
using turnover money)
Capital left: Rm -165,100(Extra Cost)

Month/ Month Mont Month Month Month Month Month Month Month Month Month Month
Source of 1 h2 3 4 5 6 7 8 9 10 11 12
income

Cement 4000- (530) (530) (530) (530) (530) 5510- (915) (915) (915) (915) (915)
Supplies 810 Bags Bags Bags Bags Bags 810 Bags Bags Bags Bags Bags
Bag Sold Sold Sold Sold Sold Bag Sold Sold Sold Sold Sold
(530) (650)
Rm Rm Rm Rm Rm Rm Rm Rm Rm Rm Rm Rm Rm
(40,000) 10,600 10,60 10,600 10,600 10,600 10,600 18,300 18,300 18,300 18,300 18,300 18,300
Sales 0 Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales
Sales

Renovation 135 135 135 135 135 135 135 135 135 135 135 135
Works bag of bag bag of bag of bag of bag of bag of bag of bag of bag of bag of bag of
cement of cement cement cement cement cement cemen cement cement cement cement
ceme t
nt
Rm Rm Rm Rm Rm
(9,000) 30,000 30,000 30,000 30,000
Sales Sales Sales Sales

Investment 50%
s Return
Rm Rm
(20,000) 30,000

*First and the 7th month will be restock month using by using turnover sales money and 810
bags of cement will be used for renovation works

Profit Calculation

Source 1(Cement Supplies)

530 x Rm20 for first 6 month month = Rm 10,600

915 x Rm20 for last 6 month month = Rm 18,300

Rm 7,950 x 6 months + Rm 9,750 x 6 months = Rm 173,400

Source 2(Renovation)

Rm30,000 Quotation per project


Rm30,000 x 4 Projects = Rm 120,000

Source 3 (Investments)

Rm 20,000 x 150% = Rm 30,000

Total Earning: Rm 323,400 165,100(extra cost) = Rm 158,300

Percentage earning : (208,300 100,000 x 100) - 100 = 58.3%

Conclusion

This business plan is a profitable business after the being analysed using financial
planning as it will yield a maximum profit of 58.3% instead of given requirement of
30%. The important point of this business is to have multiple stream of income so that
the risk of oversupply of goods in the business would be minimized. As well as
investing back the profit onto the goods and grow the sales to a higher tier in the
industry.