Chapter 5

Financial Aspect

This chapter will serve as the major assumption adopted for the projection of different

financial statement.

Notes and Assumption

 The total project cost shall be financed based on the capital contribution of each

partner.

 “Food Express” should close the books of accounts using the fiscal year.

 The working Capital is set annually.

 Purchases will increase by 5% per annum.

 Ending inventories of raw materials should be 20% of purchase available for use.

 Ending inventory of office supply should be 30% of purchase available for use.

 Ending inventories of other supplies should be 10% of purchase available for use.

 Ending inventories of restaurant wares for takeout should be 30% of purchase

available for use.

 Depreciation of properties is based on the straight line method.

 Utilities expense should be increased by 5% per annum.

 Advertising expense should be increased by 5% per annum.

 Miscellaneous expense includes the expense in uniform.

 Increase in sales per year is 10%.

 Income tax rate should be 20% of the net income.

Building Rough Estimate

ESTIMATES OF MATERIALS

DESCRIPTION

FLOORING, TOTAL

CEILING & WALL QTY UNIT UNTI AMOUNT(PhP)

FINISHINGS PRICE(PhP)

CEMENT POZ 10 BAGS 225 2250

MARINE PLYWOOD 20 PCS 390 7800

2X2X10 40 PCS 235 9400

2X3X16 30 PCS 568 17040

CWN 2 2 KL 40 80

CWN 3 2 KL 40 80

FIN PALI 1 2 KL 75 150

CONCRETE NAIL 3 3 KL 120 360

16X16 TILES 151 PCS 63 9513

2X3X12 S4S KD 30 PCS 426 12780

TOTAL 59,543
 ELECTRICAL QTY UNIT UNIT TOTAL

PRICE(PhP) AMOUNT(PhP)

2 – 2.0 mm² THHN 1 BOX 1620 1620

15 mm PVC FLEXIBLE 2 ROLL 524.70 1049.4

T8 FLOURESCENT 2 PCS 232 464

LAMP 18w

REFLECTIVE 2 PCS 533 1066

LUMINAIRE

TOTAL 4,199.4

Work in Capital

Purchases 994,401.6

Resto Wares (Take Out) 12,231

Office Supplies 4,875

Other Supplies 13,860

Salaries Expense 401,101

Utilities Expense 79,188

Advertising Expense 2,000

Cleaning tools Expense 1,174.50

Miscellaneous Expense 3,000

Total 1,511,831.1
 Organizational Cost

Mayor’s Permit fee 500.00

Sanitary Permit 50.00

Police Clearance 50.00

Baranggay’s Permit with cedula 30.00

Fire Inspection fee 125.00

Community tax certificate 300.00

SEC Registration 10,000.00

DTI Permit Name 320.00

SSS registration 200.00

BIR PERMIT 500.00

Bldg. Renovation 63,742.40

Total 75,817.40

Machineries, Tools, and Equipment

Kitchen Equipment 41,925

Kitchen Utensils 2,828

Resto Equipment 80,106

Office Equipment 15,760

Cleaning Tools 1,174.5

 Maintenance 1,475

Resto Wares (Take Out) 12,231

Total 155,499.5

Furniture and Fixture 21,413.00

Total Projected Cost

Rent 48,000

Machineries / Tools and Equipment 155,039.5

Furniture’s and Fixtures 21,413.00

Working Capital 1,511,831.1

Organizational Cost (Pre Operating Cost) 75,817.40

Total 1,812,561.00
 Capital Contribution

Name Contribution Ownership Type of partnership

Alec M. Dula 360,000.00 24 General

Alyssa Marie M. Dula 285,000.00 19 Limited

Allan P. Dula 285,000.00 19 Limited

Maynard O. Lingad 285,000.00 19 Limited

Lady Joy O. Lingad 285,000.00 19 Limited

Total 1,500,000.00 100

Annual Depreciation

Kitchen Equipment

Year Annual Depreciation Accumulated Book Value

depreciation

41, 925

1 8, 385 8, 385 33, 540

2 8, 385 16, 770 25, 155

3 8, 385 25, 155 16, 770

4 8, 385 33, 540 8, 385

5 8, 385 41, 925 0

 Office Equipment

Year Annual Depreciation Accumulated Book Value

depreciation

15, 760

1 3, 152 3, 152 12, 608

2 3, 152 6, 304 9, 456

3 3, 152 9, 456 6, 304

4 3, 152 12, 608 3, 152

5 3, 152 15, 760 0

Restaurant Equipment

Year Annual Accumulated Book Value

Depreciation depreciation

80, 106

1 16, 021.20 16, 021.20 64, 084.8

2 16, 021.20 32, 042.40 48, 063.6

3 16, 021.20 48, 063.6 32, 042.4

4 16, 021.20 64, 084.8 16, 021.20

5 16, 021.20 80, 106 0

 Maintenance Equipment

Year Annual Accumulated Book Value

Depreciation depreciation

1, 475

1 295 295 1, 180

2 295 590 885

3 295 885 590

4 295 1, 180 295

5 295 1, 475 0

Furniture’s and Fixtures

Year Annual Accumulated Book Value

Depreciation depreciation

21,413

1 2,141.3 2,141.3 19,271.17

2 2,141.3 4,282.6 17,130.4

3 2,141.3 6,423.9 14,989.1

4 2,141.3 8,565.2 12,847.8

5 2,141.3 10,706.5 14,989.1

 Kitchen utensils

Year Annual Accumulated Book Value

Depreciation depreciation

2,828

1 565.6 565.6 2,262.4

2 565.6 1,131.2 1,696.8

3 565.6 1,696.8 1,131.2

4 565.6 2,262.4 565.6

5 565.6 2,828 0

Inventory

Other supplies

Year 1 2 3 4 5
Beginning 1,386 1,593.9 1,687.46 1,773.21
Inventory
Purchases 5% 13,860 14,553 15,280.65 16,044.68 16,846.91
Increase
Total purchase 13,860 15,939 16,874.55 17,732.14 18,620.12
available
Ending 1,386 1,593.9 1,687.46 1,773.21 1,862.01
Inventory
*10%avail
Total supplies 12,474 14,345.1 15,187.10 15,958.93 16,758.11
used
 Raw materials

1 2 3 4 5

Beg. 198,880.32 248,600.4 268,985.63 284,025.96

Inventory

(10%avail)

Purchase 5% 994,401.6 1,044,121.68 1,096,327.76 1,151,144.15 1,208,701.36

increase

Total 994,401.6 1,243,002 1,344,928.6 1,420,129.78 1,492,727.32

purchase

available

Ending 198,880.32 248,600.4 268,985.63 284,025.96 296,545.46

Inventory

(20%avail)

Total 795,521.28 994,401.6 1,075,942.97 1,136,103.82 1,194.181.6

Restaurant Wares and Takeout

1 2 3 4 5

Beg. Inventory 3,669.3 4,962.56 5,534.7 5,907.92

Purchase 12,231 12,842.55 13,484.68 14,158.91 14,866.86

 (5%increase)

Total purchase 12,231 16,541.85 18,447.24 19,693.08 20,774.78

available

Ending 3,669.3 4,962.56 5,534.17 5,907.92 6,232.43

Inventory

30%avail

Total Restaurant 8,561.7 11,579.29 12,913.07 13,785.16 14,542.35

wares/take out

Office supplies

1 2 3 4 5

Beginning 1,462.5 1,974.38 2,204.72 2,354.44

inventory

Purchase(5% 4,875 5,118.75 5,374.69 5,643.42 5,925.59

increase)

Total purchase 4,875 6,581.25 7,349.07 7,848.14 8,280.03

available

End inv.(30% 1,462.5 1,974.38 2,204.72 2,354.44 2,484.01

available)

Total office 3,412.5 4,606.88 5,144.35 5,493.7 5,796.02

supplies use
 Cleaning Tools

YEAR 1 2 3 4 5

Beginning

inventory 352.35 475.67 531.17 567.24

Purchase(5% 1,174.50 1,233.23 1,294.89 1,359.63 1,427.62

increase)

Total purchase 1,174.50 1,585.58 1,770.56 1,890.8 1,994.86

available

End inv.(30% 352.35 475.67 531.17 567.24 598.45

available)

Total Cleaning 822.15 1,109.91 1,239.39 1,323.56 1,396.40

Materials used
Expenses

Salaries Expense

Employee Monthly Philhealth SSS Total Total

salary employee Employer’s employee’s salary
share share share share
Cashier 6,525.00 150 320 470 6,995

Cook 9,787.50 150 320 470 10,257.50

Asst. 8,700.00 150 320 470 9.170

cook/steward

Waiter 6,252.00 150 320 470 6,995

Total 31,537.5 600 1,280 1880 33,417.5

x12 x12 x12 x12 x12

total 378,450 7,200 15,360 22,560 401,010

Utilities expense

Price 1 2 3 4 5

Electricity 2,500 30,000 + 5% + 5% + 5% + 5%

Water 1,500 18,000 + 5% + 5% + 5% + 5%

Consume

Telephone 999 11,988 + 5% + 5% + 5% + 5%

LPG 1,600 19,200 + 5% + 5% + 5% + 5%

Total 6,599 79,188 83,147.4 87,304.77 91,670.01 96,253.50

 Advertising expense

1 2 3 4 5

Tarp 1,000.00

Signage 1,000.00

Total 2,000.00 2,100.00 2,205.00 2,315.25 2,431.01

Taxes and Licenses

1 2 3 4 5

Mayors 500,00 525 551.25 578.81 607.75

Permit

Business Tax 300 315 330.75 347.29 364.65

Sanitary

permit Fee 50 52.5 55.13 57.89 60.48

Inspection 300 315 330.75 347.29 364.65

Service 100 105 110.25 115.76 121.38

Fire 125 131.21 137.81 114.70 151.94

Inspection

Total 1,375 1,443.75 1,515.74 1,591.74 1,671.33

 Miscellaneous

1 2 3 4 5

Uniform 3,000 - - -

Projected Sales

Quantity Year 1 Year 2 Year 3 Year 4 Year 5

A Year

500Viands 24,000 1,320,000.00 + 10% + 10% + 10% + 10%

(Php. 55.00)

400Beverages 19,200 480,000.00 + 10% + 10% + 10% + 10%

(Php. 25.00)

300Snacks 14,400 360,000 + 10% + 10% + 10% + 10%

(Php. 25.00)

Total 57,600 2,160,000 2,376,000 2,613,600 2,874,960 3,162,456

*The projected sales was based on the projected persons and customer who visits and

patronize the products of The Food Express per day multiplied by the total days of

operations, multiplied by the total week per month multiplied by the total month per

year*
 The Food Express's
Income Statement

Year 1 2 3 4 5
Sales 2,160,000.00 2,376,000.00 2,613,600.00 2,874,960.00 3,162,456.00
Cost of Sales 795,521.28 994,401.60 1,075,942.97 1,136,103.82 1,194,181.60
Gross Income 1,364,478.72 1,381,598.40 1,537,657.03 1,738,856.18 1,968,274.40
Less Operating Expense
Salaries 378,450.00 378,450.00 378,450.00 378,450.00 378,450.00
Employee Benefits
SSS 15,360.00 15,360.00 15,360.00 15,360.00 15,360.00
PhilHealth 7,200.00 7,200.00 7,200.00 7,200.00 7,200.00
Restaurant Wares 8,561.70 11,579.29 12,913.07 13,785.16 14,542.35
Office Supplies 3,412.50 4,606.88 5,144.35 5,493.70 5,796.02
Organizational Cost 75,817.40
Utilities Expense 79,188.00 83,147.40 87,304.77 91,670.01 96,253.51
Advertising Expense 2,000.00 2,100.00 2,205.00 2,315.00 2,431.01
Miscellaneous Expense 3,000.00 - - - -
Rent Expense 144,000.00 144,000.00 144,000.00 144,000.00 144,000.00
Other Supplies 12,474.00 14,345.10 15,187.10 15,958.93 16,758.11
Cleaning Tools Expense 822.15 1,109.91 1,239.39 1,323.56 1,396.40
Taxes and Licenses 1,375.00 1,443.75 1,515.94 1,591.74 1,671.33
Depreciation
Office Equipment 3,152.00 3,152.00 3,152.00 3,152.00 3,152.00
Kitchen Equipment 8,385.00 8,385.00 8,385.00 8,385.00 8,385.00
Restaurant Equipment 16,021.20 16,021.20 16,021.20 16,021.20 16,021.20
Maintenance Equipment 295.00 295.00 295.00 295.00 295.00
Furnitures and Fixtures 2,143.30 2,143.30 2,143.30 2,143.30 2,143.30
Kitchen Utensils 565.60 565.60 565.60 565.60 565.60
Total Expenses 762,222.85 693,904.43 701,081.72 707,710.20 714,420.83
Operating Income Before Tax 602,255.87 687,693.97 836,575.31 1,031,145.98 1,253,853.57
Less Income tax 120,451.17 137,538.79 167,315.06 206,229.20 250,770.71
Net Income 481,804.70 550,155.18 669,260.25 824,916.78 1,003,082.86
 Food Express's
CashFlow

Year 1 2 3 4 5
Cash Flow From Operating Activities
Cash Inflow

Sales Revenue 2,160,000.00 2,376,000.00 2,613,600.00 2,874,960.00 3,162,456.00

Cash Outflow
Cash Outflow
Less Disbursement

Salaries Expense 378,450.00 378,450.00 378,450.00 378,450.00 378,450.00

SSS Payment 15,360.00 15,360.00 15,360.00 15,360.00 15,360.00

PhilHealth 7,200.00 7,200.00 7,200.00 7,200.00 7,200.00

Office Supplies 3,412.50 4,606.88 5,144.35 5,493.70 5,796.02

Utilities Expense 79,188.00 83,147.40 87,304.77 91,670.01 96,253.51

Taxes and Liscences 1,375.00 1,443.75 1,515.94 1,591.74 1,671.33

Advertising Expense 2,000.00 2,100.00 2,205.00 2,315.00 2,431.01

Other Supplies 12,474.00 14,345.10 15,187.10 15,958.93 16,758.11

`
Cleaning Tools Expense 1,109.91 1,239.39 1,323.56 1,396.40
Purchases (Raw Materials) 795,521.28 994,401.60 1,075,942.97 1,136,103.82 1,194,181.60

Restaurant wares (takeout) 8,561.70 11,579.29 12,913.07 13,785.16 14,542.35

Rent Expense 144,000.00 144,000.00 144,000.00 144,000.00 144,000.00

Miscellaneous 3,000.00 - - - -

Organizational Cost 75,817.40 - - - -

Income Tax Payment - 120,451.17 137,538.79 167,315.06 206,229.20

Total Cash outflow 1,526,359.88 1,778,195.10 1,884,001.38 1,980,566.98 2,084,269.53

Net cash inflow from operation 633,640.12 597,804.90 729,598.62 894,393.02 1,078,186.47
Cash inflow

Restaurant Equipment 80,106.00

kitchen equipment 41,925.00

Maintenance Equipment 1,475.00

Kitchen Utensils 2,828.00

Office Equipment 15,760.00

Furnitures and Fixtures 21,413.00

Total Cash outflow 163,507.00
Cash Inflow

Capitalization from Partners 1,500,000.00

Total cash inflow from financing 1,500,000.00

Cash balance Inflow over Outflow 1,970,133.12 597,804.00 729,598.62 894,393.02 1,078,186.47

Add Beginning Balance 1,970,133.12 2,567,937.12 3,297,535.74 4,191,928.76

Cash End 1,970,133.12 2,567,937.12 3,297,535.74 4,191,928.76 5,270,115.23

 The Food
Express's
Balance Sheet
2017-2021
YEAR 1 2 3 4 5
Current Assets

Cash on Hand 1,970,133.12 2,567,937.12 3,297,535.74 4,191,928.76 5,270,115.23

Total Current Assets 1,970,133.12 2,567,937.12 3,297,535.74 4,191,928.76 5,270,115.23

Non Current Assets

Furniture and Fixtures 21,413.00 21,413.00 21,413.00 21,413.00 21,413.00

Less:

Accumulated Depreciation 2,141.30 4,282.60 6,423.90 8,565.20 10,706.50

Book Value 19,271.70 17,130.40 14,989.10 12,847.80 9,875.25

Office Equiment 15,760.00 15,760.00 15,760.00 15,760.00 15,760.00

Less:

Accumulated Depreciation 3,152.00 6,304.00 9,456.00 12,608.00 15,760.00

Book Value 12,608.00 9,456.00 6,304.00 3,152.00 -

Kitchen Equipment 41,925.00 41,925.00 41,925.00 41,925.00 41,925.00
Less:

Accumulated Depreciation 8,385.00 16,770.00 25,155.00 33,540.00 41,925.00

Book Value 33,540.00 25,155.00 16,770.00 8,385.00 -

Restaurant Equipment 80,106.00 80,106.00 80,106.00 80,106.00 80,106.00

Less:

Accumulated Depreciation 16,021.20 32,042.40 48,063.60 64,084.80 80,106.00

Book Value 64,084.80 48,063.60 32,042.40 16,021.20 -

Maintenance Equipment 1,475.00 1,475.00 1,475.00 1,475.00 1,475.00

Less:

Accumulated Depreciation 295.00 590.00 885.00 1,180.00 1,475.00

Book Value 1,180.00 885.00 590.00 295.00 -

Kitchen Utensils 2,828.00 2,828.00 2,828.00 2,828.00 2,828.00

Less:

Accumulated Depreciation 565.60 1,131.20 1,696.80 2,262.40 2,828.00

Book Value 2,662.40 1,696.80 1,131.20 565.60 -

Total Non Current Assets 132,122.75 101,561.55 70,999.45 40,437.35 9,875.25

Total Assets 2,102,255.87 2,669,498.67 3,368,535.19 4,232,366.11 5,279,990.48

Liabilities and Partner's

Equity
Liablities

Income tax Payable 120,451.17 137,538.79 167,315.06 206,229.20 250,770.71

Total Current Liabilities 120,451.17 137,538.79 167,315.06 206,229.20 250,770.71

Partner's Equity 1,500,000.00 1,981,804.70 2,531,959.88 3,201,220.13 4,026,136.91

Add Net Income 481,804.70 550,155.18 669,260.25 824,916.78 1,003,082.86

Total Equity 1,981,804.70 2,531,959.88 3,201,220.13 4,026,136.91 5,029,219.77

Total Liabilities and
Equity 2,102,255.87 2,669,498.67 3,368,535.19 4,232,366.11 5,279,990.48