CHAPTER VIII

FINANCIAL PLAN
This chapter discusses the financial aspect of Magis Events. Included in the
chapter are the assumptions, capital requirements, financial statements, and the
exit/payback period and strategy.
a. Assumptions
Varieties of assumptions were made to facilitate and make possible the projection
of the financial statements of Magis Events for its forthcoming actual operations. The
business is expected to begin its operations on the second semester of academic year
2014-2015, that which will start on November 2014 to March 2015.
Financial projections will be based on per semester basis of operations. It would
be limited to the following assumptions:
1. Sales Projection
Sales should increase at least 10% per semester of operations.
The business will allow credit with 25% advance payment for the
reservation.
2. Projection of Expense
The business assumes that expenses such as advertising, transportation
and miscellaneous will increase by 5%.
All purchases would be cash or advance payment basis.
3. Assets
Since, there will be credit sales, there will be accounts receivable.

4. Capitalization
Since, this a service business, the company will be used the 25% advance
payment from client for the rolling capital.
5. Distribution of Income/Loss
Net income or loss will be distributed equally to the partners.
6. Accounting Method
The accrual method will be used in the preparation of the financial
statements.
7. Operation
The business assumes that service that we have target 2 clients per
month and 10 clients in a semester. Business operation is 5 days in a
week, 20 days in a month, and 100 days in a semester.

b. Capital Requirements
Each members are equally contributed P 1, 075.00 or P4, 300.00 to sustain the
pre-operating expenses. The equal share of the members will be considered as their
investment. Since the members are contributed equally for the pre-operating, the
income will be divided equally among the partners.


Table 10
Magis Event

Projected cost for the the first
month
Pre-operating Expense

Preparation of Business Plan 1,500.00

Business Registration

and Liscencing 500.00 2,000.00


Other Expenses

Office Supplies 200.00

Programming(logo) 500.00

Advertising 500.00

Transportation 600.00

Contingency 500.00 2,300.00

TOTAL

4,300.00



The projected cost for the 1
st
month includes the pre-operating expense and
other expenses. The pre-operating expense includes the preparation of the business
plan, which consists of printing of the paper, transportation expenses for the
canvassing, snacks during defenses, etc., and the business registration and licensing.
The office supplies are amounted to P200.00 per month. Other expenses include the
office supplies, programming expense, advertising expense, transportation expense and
the contingency expense which will be reserve for petty and immediate expenses.

Funding the Capital
The business will be used the 25% partial payment from the client for the rolling
capital.
c. Projected Financial Statements
Income Statement
This section is a statement showing the performance of the business for a given
period of time. It summarizes the revenue earned and the expenses incurred by the
business for that period of time.
Magis Events income statement for the first three semesters of its operations is
projected to have an increase of 10% for sales, and 5% for the expenses.











Table 11
Magis Event

Projected Income Statement per
Operation

Wedding Service


Decoration

45,000.00
Expenses

flower 20,000.00

labor 5,000.00

transportation 3,000.00

others 2,000.00 30,000.00
Profit

15,000.00

Photography

35,000.00
Professsional Fee

2 photographers (1,500) 3,000.00

2 videographers (1,500) 3,000.00

transportation 2,500.00

output 8,000.00 16,500.00
Profit

18,500.00

Reception and Food

75,000.00
Rent for the reception 12,000.00

Catering service 50,000.00

transportation 3,000.00 65,000.00
Profit

10,000.00

Net proft

28,000.00









Debut Party

Decorations

20,000.00
Expenses

flowers 5,000.00

transportation 1,000.00

labor 3,000.00

others 3,000.00 12,000.00
profit

8,000.00

Photography

27,000.00
Expenses

Professional fee

2 photography (1,500) 3,000.00

1 videography 1,500.00

transportation 2,500.00

output 6,000.00 13,000.00
Profit

14,000.00

Catering

45,000.00
Expenses

Catering Services 35,000.00 35,000.00
Profit

10,000.00

Seminars

Cost of Service

30,000.00

Expenses

Professional Fee

Speaker 3,500.00

sound system 2,500.00

Decorations 2,500.00

Food 6,000.00

Rent for the Venue 5,000.00

others 2,500.00 22,000.00
Profit

8,000.00


This table includes the income statement per event the wedding, debut and
corporae evens.


Table 14


Magis Events


Projected income for the three
semester


2nd semester
1st semester
2nd semester

service revenue 80,000.00 88,000.00 96,800.00

Expenses

Advertising 525.00 551.25 578.81
office supplies 1,000.00 1,050.00 1,102.50
rent 1,300.00 1,300.00 1,300.00
transportation 2,000.00 2,100.00 2,205.00
miscellaneous 300.00 315.00 330.75
others 2,000.00 2,100.00 2,205.00
total expenses 7,125.00 7,416.25 7,722.06

Net income 72,875.00 80,584.00 89,077.94


The table shows the projected income statement of Magis events for the next
three semesters of operations. It shows from the projections that at the on set of the
operations on the 2
nd
semester, the business would incur a profit of P72, 875.00,
P 80,58.00, for the 1
st
semester of S/Y 2015-2016, and P89,077.94 for the 2
nd
semester
of the school year.
Sales projections are computed in which 2 customers in a month; The business
assumed of 10 costumers per semester. Our sales and service fee are expected to
increase by 10% by semester.
We assume that seminars services cost P 30,000, P22,000 is the expenses like
food, decorations, professional fee for the speakers and etc.
Expenses include the salaries, IGP Cafeteria rent, advertising expense,
transportation expense, and miscellaneous expense. Expenses are expected to
increase by 5% per semester.
IGP Cafeteria rent amounts to P1, 300.00 per semester.


Cash Flow
This section provides information about the cash receipts and disbursement of
Magis Event. Also, this statement shows the net increase or decrease in cash during
the period and the cash balance at the end of the period.




Table 15


Magis Events


Projected Cash Flow for three
semesters

Pre-
operating
2nd semester
1st
semester
2nd
semester
Cash Inflows

Service revenues

80,000.00 88,000.00 96,800.00
Partners' contribution 4,300.00

Total cash inflows

80,000.00 88,000.00 96,800.00

Cash outflows

Expenses
preparation of business
plan 1,500.00

business registration 500.00

Advertising 500.00 525.00 551.25 578.81
office supplies 200.00 1,000.00 1,050.00 1,102.50
rent

1,300.00 1,300.00 1,300.00
transportation 600.00 2,000.00 2,100.00 2,205.00
programming/logo 500.00

miscellaneous

300.00 315.00 330.75
contingency 500.00

others

2,000.00 2,100.00 2,205.00
Total operating
expense 4,300.00 7,125.00 7,416.25 7,722.06
Total Cash outflows

7,125.00 7,416.25 7,722.06
Net increase in cash 0.00 72,875.00 80,583.00 89,077.00
Add: Beg. Cash
Balance 0.00 0.00 72,875.00 153,458.00
Ending Cash Balance 0.00 72,875.00 153,458.00 246,835.00



The table shows the cash receipts and disbursement for the three semesters of
operation of Magis event. It shows that for the 2
nd
semester of the S/Y 2014-2015, the
ending cash balance would be P72, 875.00. For the 1
st
and 2
nd
semester of S/Y 2014-
2015, the ending cash balance is P153, 458.00 and P246, 835.00 respectively.
Included in the cash inflow for the pre-operating is the partners contribution
which amounted to P4, 300.00. For the actual business operation, cash inflows are the
cash fees from the service.
The cash outflows for the pre- operating is the business plan preparation, and
business registration. Cash outflows during the actual business operation include the
operating expenses incurred in a semester.

Balance Sheet
This section is the statement of the financial position or condition of a business
by listing the assets, liabilities and equity as at a specific date.


Table 16
Prjected Balance Sheet

Magis Events or Three
Semesters


Pre-Operating 2nd Semester 1st semester 2nd semester
Assets

Cash 4,300.00 72,875.00 153,458.00 246,835.00
Total Assets


Labilities

Partner's Equity

Managuelod 1,075.00 18,218.75 38,364.50 61,708.75
Mercado 1,075.00 18,218.75 38,364.50 61,708.75
Ibarlin 1,075.00 18,218.75 38,364.50 61,708.75
Balondo 1,075.00 18,218.75 38,364.50 61,708.75

Total Liabilities and

Partner's Equity 4,300.00 72,875.00 153,458.00 246,835.00




The table shows the assets, liabilities, and equity of Magis Events. The figures
reflect that of the financial position of the business.
Assets include the cash balance for a certain period. Total assets for the pre-
operating period are P4, 300.00, liabilities and partners equity also amounted to
P 4,300.00
For the second semester of S/Y 2014-2015, the total assets amounted to P
72,875.00, same with that of the liabilities and partners equity. Each members equity
amounted to P 18,218.00.
The total assets for the first semester of S/Y 2015-2016 amounted to P153, 458.00,
same with that of the liabilities and partners equity. Each members equity amounted to
P38, 364.50.
For the second semester of S/Y 2015-2016, the total assets amounted to P 246,
835.52, same with that of the liabilities and partners equity. Each members equity
amounted to P 61,708.75.
d. Exit/Payback Period/Strategy
Payback Period
The Payback Period refers to the amount of time required for the business to
recover its initial investment.

This computation shown above reflects the business total investment and the
total cash inflows for the first three semesters of operations. Based from the trend of
cash inflow, the business expects that the total investment will be returned at
approximately 5 months.

Return on Investment (ROI)
The ROI is a measure of the business overall effectiveness and performance of
management in generating profits with its asset. It is the ratio of the companys
investments relative to its net income and is expressed in terms of percentage.

A. 2
nd
Sem

1694.76 %


The computation shows that the company will have 1694.76% Return on
Investment in the 2
nd
Semester of S/Y 2014-2015.
B. 1
st
sem

1874.05%

The computation shows that the company will have 1874.05% Return on
Investment in the 1
st
Semester of S/Y of 2015-2016.

C. 2
nd
Sem

2071.56 %

The computation shows tht the company will have 2071.56% Return on
Investments in the S/Y of 2015-2016.

Profit Margin
The profit margin indicates the firms ability to generate profit. The
computation below will show the companys ability to generate profit in the 2
nd
semester
of S/Y 2014-2015, 1
st
sem of S/Y 2015-2016 and 2
nd
sem of S/Y 2015-2016.

2
nd
Semester

The computation shows that the company will have 1694.76% roit marginin the
2
nd
Semester of S/Y 2014-2015.


1
st
Semester

The computation shows that the company will have 91.58% Return on
Investment in the 1st Semester of S/Y 2015-2016.



2
nd
Semester

The computation shows that the company will have 92.02% Return on
Investment in the 2
nd
Semester of S/Y 2015-2016.





Table 17


Magis Event


Profitability
Ratios
Semester Sales Net Income Investment Return on Profit margin

Investment

2nd Semester P 80,0.0000 P 72,875.00 P 4,300.00 1694.76% 91.09%
1st Semester P 88,000.00 P 80,584.00 P 4,300.00 1874.05% 91.50%
2nd Semester P 96,800.00 P 89,077.94 P 4,300.00 2071.56% 92.02%

The Return on Investments (ROI) of the business is 1694.76% as the business
starts its operations. As the business reach its 2
nd
operation, its return on investments
becomes 1874.05%. At end of the 3
rd
operation 2071.56% its return on investments.
The profit margin Magis Events 2
nd
semester of S/Y 2014-2015 is 91.09%,
91.50% for the 1
st
semester and 92.02% for the 2
nd
semester of S/Y 2015-2016. These
figures show the ability of the business to generate profit.

























Chapter IX
CONCLUSION
The materialization and manifestation of the business is the end goal of this
business plan. All the writings will not be a success without the execution. From the
business mission and goals down to the financial aspect of the business must be
surpass and illustrate in the actual business operation.
Based from the goals and objectives mentioned, the management seek to attain
all of those that was mentioned. The business plan will be a means of the group as
preparation in their future endeavor. The difficulties that they will be facing as they go
through the operation will serve as their stepping-stones and experience in the near
future.
Magis Events is highly feasible basing from the ample study, results and figures
they have come up and projected in the business proposal. The business will be able to
surpass all challenges even though given the fact that the business is newly established
and a new player in its field.