CHAPTER VII

PROFITABILITY

This chapter presents the total investment cost needed to start the proposed business and
the list of financiers. The cost requirements are categorized according to this category.

A. Pre-operating Capital Cost

B.

ITEMS CATEGORY COSTS SOURCE

A Pre-operating Capital Cost
1 Management of Pre-Project Operation;
a. Supervision, Coordination, Test Runs P 1,000.00 Investment
b. Supplier’s Arrangement 1,000.00 Investment
c. Arrangement of Marketing and Promotion 2,000.00 Investment
2 Contingencies 2,000.00 Investment

Total Pre-Operating Capital Cost P 6,000.00

Pre-Operating Capital Cost

 C. Pre-Operating Production Cost

ITEMS CATEGORY COSTS SOURCE

B Pre-Operating Production Costs
1 Salaries and Wages P 5,000.00 Investment
2 Raw Materials 1,000.00 Investment
3 Overhead 2,000.00 Investment
4 Supplies
a. Spoon 300.00 Investment
b. Fork 300.00 Investment
c. Paper plate 300.00 Investment
d. Others 500.00 Investment

Total Pre-Operating Production Costs P 9,400.00

Pre-Operating Production Cost

ITEM CATEGORY COST

A Total Pre-Operating Capital Cost P 6,000.00

B Total Pre- Production Cost 9,400.00

TOTAL COST OF PROJECT P 15,400.00

Total Projected Cost

 ITEMS CATEGORY EQUITY %

1. Chrystle Jane O. Molina Personal Resources P 3,360.00 12.5%

2. Cybelle Jan T. Baguio Personal Resources P 3,360.00 12.5%
3. Najimah H. Domara-ag Personal Resources P 3,360.00 12.5%
4. Nashim R. Racman Personal Resources P 3,360.00 12.5%
5. Potre Hajidia P. Imam Personal Resources P 3,360.00 12.5%

TOTAL P 16,800.00 100%

List of Financier
A. Pre-Operating Period

1. Balance Sheet
Ka-Cho-Go
Pre-Operating Period
Balance Sheet

ASSETS
Cash on Hand P 1,400.00
Inventory 1,000.00
Overhead 2,000.00
Supplies 1,400.00
FIXED ASSETS
Intangibles:
Pre-Operating Capital Cost 6,000.00
Pre-Operating Production Cost 5,000.00
TOTAL ASSETS P 16,800.00

LIABILITIES and CAPITAL

TOTAL LIABILITIES -0-
Capital Contribution:
Chrystle Jane O. Molina P 3,360.00
Cybelle Jan T. Baguio 3,360.00
Najimah H. Domara-ag 3,360.00
Nashim R. Racman 3,360.00
Potre Hajidia P. Imam 3,360.00
TOTAL LIABILITES&CAPITAL P 16,800.00
2. Cash Flow
Kam-Cho-Go
Pre-Operating Period
Cash Flow

Cash Contributions:
Chrystle Jane O. Molina P 3,360.00
Cybelle Jan T. Baguio 3,360.00
Najimah H. Domara-ag 3,360.00
Nashim R. Racman 3,360.00
Potre Hajidia P. Imam 3,360.00
TOTAL CASH INFLOWS P 16,800.00

Less:

Cash Disbursements:

Pre-Operating Capital Cost P 6,000.00

Pre-Operating Production Cost 9,400.00

TOTAL PROJECTED COST P 15,400.00

Cash Balance, End P 1,400.00

B. Operating Period

1. Projected Income Statement

Kam-Cho-Go
Operating Period
Project Income Statement
For the year ended

YEAR 1 YEAR 2 YEAR 3 YEAR 4

Sales P 240,000 312,000 405,600 527,280

Cost of Sales 72,000 93,600 121,680 158,184

Net Sales 168,000 218,400 283,920 369,096

Operating 100,000 150,000 157,500 165,375

Expense

Net Income 68,000 68,400 126,420 103,721

before Tax

Net Income/ 32,000 81,000 31,080 61,654

Profit
 2. Projected Statement of Cash Flow

Kam-Cho-Go
Operating Period
Projected Statement of Cash Flow
For the year ended

YEAR 1 YEAR 2 YEAR 3 YEAR 4

CASH INFLOW

Beg. Balance P 1,400. 00 33,400.00 114,400.00 145,400.00

Cash Sales 240,000.00 312,000.00 405,600.00 527,280.00

TOTAL 241,400.00 345,400.00 520,000.00 672,680.00

CASH OUTFLOW

Cost of Sales 72,000 93,600 121,680 158,184

Operating Expense 100,000 150,000 157,500 165,375

TOTAL 172,000.00 243,600.00 279,180.00 323,559.00

Ending Balance P69,400.00 101,800.00 240,820.00 349,121.00

 3. Projected Balance Sheet

Kam-Cho-Go
Operating Period
Projected Balance Sheet
For the Year Ended

YEAR 1 YEAR 2 YEAR 3 YEAR 4

Assets

Current Assets
Cash on Hand P 69,400.00 P 101.800.00 P 240,820.00 P 349,121.00
Overhead 2,000.00 2,000.00 2,000.00 2,000.00
Supplies 1,400.00 1,400.00 1,400.00 1,400.00

TOTAL ASSETS 72,800.00 105,200.00 244,220.00 352,521.00

LIABILITIES AND
CAPITAL

TOTAL LIABILITIES -0- -0- -0- -0-

Kam-Cho-Go Capital 32,400.00 60,600.00 122,000.00 146,260.00

Income 40,400.00 44,600.00 122,220.00 206,261.00

TOTAL LIABILITIES 72,800.00 105,200.00 244,220.00 352,521.00

AND CAPITAL
 C. Financial Analysis

1. Profit Forecast

RETURN OF INVESTMENT

YEAR 1 YEAR 2 YEAR 3 YEAR4

Net Income P 29,000.00 P 221,700.00 P 259,210.00 P 164,223.00

Total Assets 169,275.00 56,275.00 297,265.00 654,337.00

Return of 0.4295 0.4269 0.4008 0.3722

Investment

Percentage 42.95% 42.69% 40.08% 37.22%