Chapter I

INTRODUCTION

Balbacua came from the Spanish word barbacoa which means

cooking meat very slowly on an open fire for several hours. Most balbacua
recipes are with ox tail or beef ribs. Balbacua is known in the Philippines
particularly in Cebu, Davao and Cagayan de Oro City. Balbacua is often found
in carenderias/fast food and is a popular pulutan. Some restaurants have
balbacua

as

main

dish

together

with

other

specialties

(http://www.iluvcebu.com/balbacua-at-island-grill/).
Bulalo is a beef dish from the Philippines. It is a light colored soup that
is made by cooking beef shanks and marrow bones until the collagen and fat
has melted into the clear broth. Bulalo is considered to be one of the most
favorite main dishes in the Philippines. Because of the popularity of this
Filipino food, restaurants and eateries specializing in cooking Bulalo were putup. Some of the famous Bulalohan can be found in Tagaytay City (Cavite)
and Sto. Tomas (Batangas). Commercial restaurants also include Bulalo in
their menu. (http://en.wikipedia.org/wiki/Bulalo).
In this feasibility study, the proposed business named Cannies
Balbacua and Bulalo is a fast food restaurant which main specialties are the
balbacua and bulalo recipies. It is a restaurant characterized both by food
which is supplied quickly after ordering, and by minimal service. This is a selfservice style where the customers will order food from the menu and pay first
to the cashiers booth before sitting on their desired desk. The food in this

restaurant is often cooked in bulk in advance and kept warm, or reheated to

order.
The proposed location of the proposed business which is in Kapatagan,
Lanao del Norte is also good for the site of the business. Aside from having
lots of cow pasture, beef were sold in the public market with a reasonable
and affordable price. This could be an advantage for the proposed business
since the supplies are available in the market. According to the latest survey
of the researchers, the people in this area are also busy with their different
businesses. Thus, there is no time for them to cook for their meals. They
usually eat in fast food restaurants available in the area. Most of the
population came from the tribe of Maranaos, Christians and Catholics. Hence,
beef products could be offered to the population not unless prohibited by the
doctor due to some illnesses or diseases.

Chapter II
PROJECT SUMMARY

A. Name of the Business

The proposed business name will be Cannies Balbacua and Bulalo. This is
a fast-food restaurant where the main dish offered is the Balbacua and
Bulalo. The name Cannies Balbacua and Bulalo means a restaurant that
offers balbacua and bulalo as the main dishes which is also known for the
Filipino people. Cannie is a term that means a large shape like a tree. This
also means that the business as it grows would reach into its goal for
success.

B. Location
The proposed business location will be in Kapatagan, Lanao del Norte
particularly near the main market building parallel to the Lozadas Bakeshop
and near the terminal to Sapad. This place is good for the proposed business
since the location has been known for the people of Kapatagan as a street for
eateries. Anywhere you would go from left to right side of the street, there
are eateries located in the area. Though having lots of competitors is a threat
for the newly started business, this could still be an advantage in calling the
attention of the customers. The only thing to do is to call their attention to

visit and have a taste of Cannies Balbacua and Bulalo. The area is quite a
busy place especially at noon time since most of the laborers and marketers
are roaming around to eat in different eateries.
C. Descriptive Definition of the Project
The proposed business named Cannies Balbacua and Bulalo is small and
sole proprietor type of business. The business offers balbacua and bulalo as
the main product and other sub-dishes such as pansit bihon, tinolang isda,
piniritong isda, ginataang mongo, and pakbet. And for the desserts, there are
recipes like sweetened coco and fruit salad. The main dishes serving are good
for 2-3 persons each bowl of balbacua and 1-2 persons for each bowl of
bulalo. Other products serving are good for 1 person only.

D. Project Long-Range Objectives (5 years)

The business long-range objectives are as follows:

To
To
To
To

provide good quality of food recipes with the right for the people
have 50% investment after five years
increase sales by 5% after five years
have an additional business branches in neighboring municipalities

such as in Maranding, Lala, Lanao del Norte

E. Summary of Findings and Conclusions

a. Market Feasibility
The business named Cannies Balbacua and Bulalo is a fast-food
restaurant with a self-service factor which means the customer will be selfserved. The demand and supply of the business will definitely increase as the
rate of the customers increases. The promotional strategies as practiced by
the competitors are also used in the proposed business such the use of
billboards, flyers and tarpaulins. Upon opening of the business, there will be a
free taste for the first 50 persons. Moreover, there will be balloons with the
business name and logo tied in the tarpaulins of the business.

b. Technical Feasibility
Cannies Balbacua and Bulalo business is a sole-proprietorship type of
business in which the business will be operated by the owner itself. The main
specialties offered by the business were the balbacua and bulalo. The
business also offers other products such as pansit bihon, tinolang isda,
piniritong isda, ginataang mongo, and pakbet. And for the desserts, there are
recipes like sweetened coco and fruit salad. The desired business hour would
be from 9:00 am to 7:00 pm, Monday to Sunday Schedule. The acquisition of
the fixed assets and other direct materials depends on the assumptions made
by the researchers.

c. Financial Feasibility
The financial analysis shows that the business returns investment
within its investment life by 190.25% and its payback period will be 1 year
and 5 months. Hence, the business is favorable since the payback period if
the business is lesser than the critical assets life. The net income ratio also
shows an increasing trend from year 1 to year 5. Thus, the business is
growing as it continues.

d. Management Feasibility
The business management will be operated by the owner with its
employees. The manager will be the general administrator of the business
and at the same time the cashier of the business restaurant. The assistant
manager will be in-charge to take-over the role of the manager on his/her
absence and/or assist the manager on the regular operation of the business.
The other employees (the kitchen staffs, table cleaners, and food servers) will
be assigned on the customer services such as preparation of the foods,
cleaning the area and the food serving to the customers.

e. Socio-Economic Contribution
The proposed business will benefit the economy of the proposed location
through the additional investments made by the company and the additional
employment for the people. The business will also benefit through the
increasing profits of the company. The additional payment made by the
business as it grows will also benefit the government through the Bureau of
Internal Revenue. Moreover, the society will benefit through the opening of a
new business with a new taste of the products offered by the proposed
business.

Chapter III
MARKET STUDY
A. Product Description
Balbacua came from the Spanish word barbacoa which means
cooking meat very slowly on an open fire for several hours. There are
many ways of cooking balbacua. As in modern times, the original
balbacua (which is made of ox tail or beef) comes into different variety of
cooking such as pork balbacua. The business used beef balbacua, while
the Bulalo which is a beef dish from the Philippines, a light colored soup
that is made by cooking beef shanks and marrow bones until the
collagen and fat has melted into the clear broth.
The proposed business also offers other food recipes such as pansit
bihon, tinolang isda, piniritong isda, ginataang mongo, and pakbet. And
for the desserts, there are recipes like sweetened coco and fruit salad. The
main recipes would be the balbacua and bulalo which also served hot to
the customers.
The balbacua and the soup of the bulalo will be pre-heated in a slow to
medium open fire displayed in the main food corner of the business. The
meat of the bulalo will be separated in a bowl. When the customers come
to order these mentioned dishes, the servers will serve the balbacua and
bulalo hot and tasty. Other dishes as mentioned above will not be pre-

heated before serving to the customers. It will be displayed in the food

corner table of the business.

B. Demand
The business major customers will not only limit to the people of
Kapatagan but also for the people visiting the area coming from the
neighboring municipalities such as in Maranding, Lala. As the people
experienced the good quality of taste of the food recipes offered by the
company especially the main recipes of the proposed business, they would
share good feedbacks to their friends and families. Hence, the customers will
increase so with the demand.

C. Supply
The supply will definitely increase as the demand increases. Since the
proposed business location is nearer to the main market building where most
of the supplies could be found (source of supplies), there would be no
difficulty in getting the supplies needed by the company. In this feasibility
study, the researchers have assumed fixed charge for the direct materials
purchased. The major competitors of the proposed business will be the
neighbor eateries available in the said area. The number of business
customers (the people visiting the area/marketers) depends on the promotion
of the proposed business.
9

D. Competitive Position
The proposed business has lots of competitors existing in the proposed
location having almost the same products and prices. It all differs in the
quality of taste offered by the companies. Cannies Balbacua and Bulalo is a
way better than any other companies existing in the area. Though the prices
are higher than the competitors prices, it is still a right price considering the
amount and sizes of the products offered. The quality of taste all matters in
the end. Thus, the proposed business would have an advantage to take a
higher position than its competitors.
Considering one of the competitors of the business (Jane Eateries) and the
comparison of the prices of the offered products of the proposed business
and the prices of the existing products (same with the proposed business
product), let us observe the table below.
Table 1. Competitors Products and Prices
Main
Recipes
Balbacua
Bulalo
Other
Recipes
Pansit
Bihon
Tinolang
isda
Piniritong
Isda

Price
s
(Php
)
25
40

10
20
15

Main
Recipes
Amount/Size
Good for 1
person.
Good for 1
person.
Good for 1
person.
Good for 1
person.
Good for 1
person.

Balbacua
Bulalo
Other
Recipes
Pansit
Bihon
Tinolang
isda
Piniritong
Isda
10

Price
s
(Php
)
60
60

10
20
15

Amount/Size
Good for 2-3
persons.
Good for 1-2
persons.
Good for 1
person.
Good for 1
person.
Good for 1
person.

Ginataan
g Mongo
Pakbet

10

Rice

10

10

Good for 1
person.
Good for 1
person.
Good for 1
person.

Dessert
Sweeten
5
Good for
ed Coco
person.
Fruit5
Good for
salad
person.
Drinks
Coca12
Good for
cola 8 oz.
person.
Coca30
cola
family
Good for
size
persons.
Mineral
15
Good for
Water
person.
E. Marketing Program

1
1

4-5
1

Ginataan
g Mongo
Pakbet

10

Rice

10

Dessert
Sweeten
ed Coco
Fruitsalad
Drinks
Cocacola 8 oz.
Cocacola
family
size
Mineral
Water

10

5
5

12

Good for 1
person.
Good for 1
person.
Good for 1
person.
Good for 1
person.
Good for 1
person.
Good for 1
person.

30

15

Good for 4-5

persons.
Good for 1
person.

As practiced of the competitors in promoting their business, they are using

tarpaulins and/or small billboards. The proposed business will also use
tarpaulins and a small billboard as well as flyers with the business name and
logo in promoting their business. Upon opening of the business, there will be
a free taste for the first 50 persons. Moreover, there will be balloons with the
business name and logo tied in the tarpaulins of the business. The market
program for the prices of the products offered, are shown below.
Table 2. Proposed Menu of Cannies Balbacua and Bulalo
Prices
Main Recipes
Balbacua
Bulalo
Other Recipes
Pansit Bihon
Tinolang isda
Piniritong Isda

(Php)
60.00
60.00
10.00
20.00
15.00

Prices
Rice
Dessert
Sweetened Coco
Fruit-salad
Drinks
Coca-cola 8 oz.
11

(Php)
10.00
5.00
5.00
12.00

Ginataang Mongo
Pakbet

10.00
10.00

Coca-cola family size

Mineral Water

30.00
15.00

Since the proposed business is a fast-food restaurant, it will be a selfservice restaurant where the customers will be self serve. The customers will
get their own tray which is located near the food stall corner and choose their
own food. The server will serve their chosen meal in a plates/bowls (dine in)
or packed to a plastic bag (dine-out). The customers will pay first to the
cashiers area before going to their desired table A charcoal stove was used
to maintain the hotness of the main meals (balbacua and bulalo). After the
customers leave their table, a table cleaner will clean the tables and bring
their used plates and bowls to the dishwasher.

12

Chapter IV
TECHNICAL STUDY

A. The Product
The proposed Cannies Balbacua and Bulalo Restaurant offers food ranging
from Asian Favorites to local food products in which the main meals were the
balbacua and bulalo products. These meals require patience in cooking since
balbacua and bulalo are cooking meat very slowly on an open fire for several
hours. This would be served hot to the customers in a continuous low to
medium flame.

B. Food Processing
Figure 1. Bulalo Process

13

5
1
2
3
4
.
B
lg
b
c
,
u
p
w
d
A
H
v
S
6
;
is
m
0
e
h
t
n
a
r
f
k
o
C
Figure 2. Balbacua Process

14

Figure 1 and 2 shows the food processing of the main products of the
business (balbacua and bulalo; excluding the other sub-products of the
business as mentioned in the previews pages).

C. Business Schedule
The desired business hour would be from 9:00 am to 7:00 pm, Monday to
Sunday Schedule. It is more advantageous for the management to open from
Monday to Sunday since most of the business traders are inviting more
people from Saturday and Sunday. Thus, the people from other neighboring
provinces tend to visit Kapatagan or do marketing in these days. From 3:00
am- 5:00 am would be for marketing since the source of supply is near to the
proposed location. The management will start cooking as soon as marketing
is done. The volume of raw products per day was shown in table 3. This table
shows the projected kilo of each product that will be consumed per day. The
schedule of marketing/acquisition of these products will be thrice per week.
Table 3. Volume per Day of the Menus Offered by the Business
Particuclars
Rice
Beef Shanks
Beef Kinche
Fish (Mackerel)
Corn
Pansit Bihon
Mongo
Squash
Okra
String Beans
Eggplant
Bitter Gourd

Per Day
14 kg.
5 kg.
4 kg.
3 kg.
1/2 kg.
1 kg.
1 kg.
1/2 kg.
1/4 kg.
1/4 kg.
1/2 kg.
1/2 kg.
15

Melon
Banana
Apple
Papaya
Condensed Milk
Gabi
Coconut
Cardava
Sago
Sticky Rice
Sweet Potato
Other Ingredients &
Spices

1 kg.
1 kg.
1/2 kg.
1/2 kg.
3 cans
1/2 kg.
5 pcs.
1/2 kg.
1/4 kg.
1 kg.
1 kg.
3 kg.

D. Store Location Map

Figure 3. Store Location Map

16

E. Store Lay-out
Figure 4. Store Lay-out

17

F. Tools, Machinery and Equipment

18

The tools, machinery and equipment needed by the business were shown
below:
Schedule 1. Summary Description of Tools, Machinery and Equipment

Particulars
Water
Dispenser

Qty.
1 set

1 unit
1 set

La Germania

2 pcs

Cleaning Tools
Ecomaps

5 pcs

Non-cotton wipers

2 pcs

Novo Brand

100.00

200.00
450.00

3 sets

Kitchen Tools
Plastic Plates and
Bowl

233.00

700.00

166.00
150.00

500.00
150.00

66.00

200.00

1,000.00

2,000.00
3,550.00
33,600.00

1 unit

Floor wiper
Tables and
chairs wiper
Garbage
cans
Sub-total

Kitchen
Utensils
Cooking
Materials
Sub-total
Total

Total Cost

ACL, Cold water only

Fujidenzo 14 Cu.ft
Double Glass Door
Showcase Chiller SU140 A ADF (White)
Forced convection
type

Refrigerator
Charcoal
Stove
Gas Stove
Set
Sub-total

Plates and
Bowls
Mugs and
Glasses
Trays

Machinery, and Equipment

Brand/Description
Unit Cost

3 sets
1 pc

3 sets
2 sets

Novo Brand
Sterilite Mini Storage
Set of spoon and fork
including spatula and
other kitchen utensils
such as knife
Steel-made cooking
pan and cooking bowl

19

600.00

600.00

25,000.00

25,000.00

500.00

500.00

3,500.00

3,500.00
29,600.00

100.00

200.00

10.00

50.00

G. Furniture and Fixtures

Schedule 2. Furniture and Fixtures
Particular
s
Food Stall
Corner

EUL

Tables and
Chairs

10
10

Description
1 table corner and a charcoal
stove corner
3 set of 2 tables and chairs
and 3 set of 4 tables and
chairs

Total

Total Cost
10,000.00
35,000.00
45,000.00

Annual
Dep.
1,000.0
0
3,500.0
0
4,500.0
0

H. Direct Materials
The food supplies estimated prices as shown below were assumed to be
acquired three times a week. Cleaning Materials includes dishwashing soaps
that would worth Php 50.00 per week. Office supplies include notebooks and
pens that would worth Php 20.00 per month. Direct Materials are assumed as
fixed charges.

20

Schedule 3. Direct Materials

Particuclars
Per Day
560.00
Rice

14 kg.
5 kg.

750.00

Beef Shanks
600.00
Beef Kinche

4 kg.
270.00

Fish (Mackerel)
3 kg.
Corn
1/2 kg.
Pansit Bihon
1 kg.
Mongo
1 kg.
Squash
1/2 kg.
Okra
1/4 kg.
String Beans
1/4 kg.
Eggplant
1/2 kg.
Bitter Gourd
1/2 kg.
Melon
1 kg.
Banana
1 kg.
Apple
1/2 kg.
Papaya
1/2 kg.
Condensed Milk
3 cans
Gabi
1/2 kg.
Coconut
5 pcs.
Cardava
1/2 kg.
Sago
1/4 kg.
Sticky Rice
1 kg.
Sweet Potato
1 kg.
Other Ingredients &
Spices
3 kg.
Total
Total Amount Per First Sched.
Acquisition
Total Amount Per Second Sched.
Acquisition
Total Amount Per Third Sched.
Acquisition

25.00
40.00
60.00
10.00
5.00
5.00
10.00
20.00
15.00
10.00
20.00
10.00
120.00
5.00
15.00
10.00
10.00
60.00
50.00
100.00
2,780.00
8,340.00
5,560.00
5,560.00
19,460.0
0

Total Per Week

21

Particuclar
s
*Cleaning
Materials
Diswashing
Soap
Particuclar
s
*Office
Supplies
Notebook
Pen

Per
Week

50.00
Per
Month
13.00
7.00

I. Utilities
Since the store is rented, the installation of electricity and water supply is
not needed due to its availability to the said area. The electricity will be paid
in LANECO and the water supply will paid on the water district of Kapatagan.

J. Waste Disposal System

The proposed business will have two garbage containers for nonbiodegradable and biodegradable waste products. The leaf-over of the
customers will be put to another container. This leaf-over will be feed to
animals to reduce food wastage. The garbage will be collected by the
municipal garbage collectors.

22

Chapter V
MANAGEMENT STUDY

A. Nature of Business
The proposed business will be a sole proprietorship type of business in
which will be operated by the owner itself. This business is a fast-food
restaurant also known as common eateries in which the main specialty
offered will be the balbacua and the bulalo, Filipino version recipe. The
manager will be the general administrator of the business and at the same
time the cashier of the business restaurant. The assistant manager will be incharge to take-over the role of the manager on his/her absence and/or assist
the manager on the regular operation of the business. The other employees
(the kitchen staffs, table cleaners, and food servers) will be assigned on the
customer services such as preparation of the foods, cleaning the area and the
food serving to the customers.
B. Labor Requirements

Personn
el
Manager/
Cashier
Assistant
Manager

No. of
Personn
el
1
1

Requirements
Graduate of any
business related
course
Must know basic
math; 18-25 years old
23

Total
Compensati
on per
Month

No. of
Hours

5,000.00

14 hours

4,000.00

10 Hours

Kitchen
staffs
2
Table
Cleaners
2
Food
Server
2
Total
8
C. Organizational

Graduate of any
culinary related
course
Must be Male and
willing to be trained.
Must be Female and
willing to be trained.

8,000.00

14 Hours

5,000.00

10 Hours

5,000.00
27,000.00

10 Hours

Chart

MK
A
sai
snt
sac
tgh
aee
nrn
t/
CS
M
at
nsa
ahf
gi f
es
r

D. Functions
Manager/Cashier- Manages the business as well as his/her employees;
owner of the business; controls the cash inflows and outflows of the

business
Assistant Manager- assists the manager of the business and take the

role of the manager on his/her absence.

Kitchen Staffs - prepare the food products and cleans the tables of the
customers; includes the dishwasher of the business who cleans the all

the dishes
Food Servers-serve the food to the customers in the food stall corner
Table cleaners- in-charge in cleaning the tables and chairs including
the floor of the business; assist also the customers

E. Time Table
24

Table 4. Time Table

Month
1
Particulars
Acquisition of fixed assets and direct
materials; completion of legal forms of the
business.
Installation of different equipment.
Sampling Promotion.
Start of the business

Chapter VI
25

Month
2

Month
3

1 2 3 4 1 2 3 4 1 2 3 4

FINANCIAL STUDY
A. Total Project Cost
Schedule 7. Total Project Cost
Particulars
Fixed Assets
Machinery and
Equipment
Cleaning Tools
Kitchen Tools
Furnture and Fixtures
Sub-Total
Working Capital:
Direct Materials
Rent Expense
Miscellaneous Expenses
Operating Costs
Labor Expense
Sub-Total
Total Project Costs

Equity

Total Cost

29,600.00
450.00
3,550.00
45,000.00
78,600.00
2,780.00
8,000.00
1,000.00
2,600.00
1,500.00
15,880.00
94,480.00

B. Sources of Financing
The researchers assumed that the owner of the proposed business will
invest an amount of Php 100, 000.00 to start a business.

C. Projected Financial Statement

a. Financial Assumptions
26

Rent Expense is paid as one month advanced and one month deposit

worth Php 4, 000.00 per month.

Miscellaneous Expense includes the flyers, tarpaulins and plastic bags;

assumed to increase by 2% starting year 1 to year 5.

Operating Costs include the light, water refill, charcoal and gas refill.
Electricity is assumed to increase by 2% every year. Pre-operation

Labor expense is worth Php 1, 500.00.

The formula used in depreciation expense is shown below:

Cost Salvage Value

Depreciation =

Life in Number of Periods

b. Income Statement
Table 5. Income Statement of the Business for the year ended Dec.
31
Particulars
Sales
Less: Direct
Materials
Rent Expense
Miscellaneous
Expense
Operating
Costs
Labor Expense
Permits and
Licenses
Depreciation
expense
Gross
Operating
Profit
Less: Income
Tax Expense
Net Income

Year 1
2,016,00
0.00
936,720.
00
52,000.0
0

Year 2
2,116,80
0.00
936,720.
00
48,000.0
0

Year 3
2,217,60
0.00
936,720.
00
48,000.0
0

Year 4
2,318,40
0.00
936,720.
00
48,000.0
0

Year 5
2,419,20
0.00
936,720.
00
48,000.0
0

6,040.00
36,710.0
0
325,500.
00

5,141.00
36,711.0
0
324,000.
00

5,244.00
36,865.0
0
324,000.
00

5,349.00
37,022.0
0
324,000.
00

5,456.00
37,182.0
0
324,000.
00

3,100.00

2,585.00

8,370.00

8,370.00

2,585.00
18,370.0
0

2,585.00
18,370.0
0

2,585.00
18,370.0
0

647,560.
00
610,120.
00
37,440.0
0

755,273.
00
642,376.
00
112,897.
00

845,816.
00
674,632.
00
171,184.
00

946,354.
00
706,888.
00
239,466.
00

1,046,88
7.00
739,144.
00
307,743.
00

27

c. Projected Cash Flow Statement

Table 6. Cash Flow Statement

Particulars
Cash Inflow
Sales
Add. Investments
Total Cash Inflows
Cash Outflows
Acquisition of Fixed
Assets
Direct Materials
Operating Costs
Permits and Licenses
Income tax expense
Rent Expense
Miscellaneous expense
Labor/Administrative
Expense
Total Cash Outflows
Net Cash Flow
Cash Balance, Beg.
Cash Balance, End

Preoperation

Year 1

Year 2

100,000.00

2,016,000.
00
0.00
2,016,000.
00

2,116,800.
00
0.00
2,116,800.
00

78,600.00
2,850.00
2,600.00
0.00
0.00
8,000.00
1,000.00

0.00
933,870.00
34,110.00
3,100.00
610,120.00
44,000.00
5,040.00

1,500.00

324,000.00
1,954,240.
00
61,760.00
5,450.00
67,210.00

100,000.00

94,550.00
5,450.00
0.00
5,450.00

Year 3

Year 4

2,217,600.00
0.00

2,318,400.00
0.00

2,217,600.00

2,318,400.00

2,419,200.
00
0.00
2,419,200.
00

0.00
936,720.00
36,711.00
2,585.00
642,376.00
48,000.00
5,141.00

0.00
936,720.00
36,865.00
2,585.00
674,632.00
48,000.00
5,244.00

0.00
936,720.00
37,022.00
2,585.00
706,888.00
48,000.00
5,349.00

0.00
936,720.00
37,182.00
2,585.00
739,144.00
48,000.00
5,456.00

324,000.00
1,995,533.
00
121,267.00
67,210.00
188,477.00

324,000.00

324,000.00

2,028,046.00
189,554.00
188,477.00
378,031.00

2,060,564.00
257,836.00
378,031.00
635,867.00

324,000.00
2,093,087.
00
326,113.00
635,867.00
961,980.00

28

Year 5

d. Projected Balance Sheet

Table 7. Balance Sheet of Cannies Balbacua and Bulalo for the year ended Dec. 31.
Particulars
Assets
Current Assets
Cash
Total Current Assets
Non-Current Assets
Machinery and Equipment
Cleaning Tools
Kitchen Tools
Furnture and Fixtures
Total
Less: Accumulated Depreciation
Total Non-Current Assets
Total Assets
Liabilities and Owner's Equity
Liabilities
Tax Payable
Total Liabilities
Owner's Equity
Capital, Beg.
Add: Net Income
Capital, End

Year 1

Year 2

Year 3

67,210.00
67,210.00

188,477.00
188,477.00

378,031.00
378,031.00

635,867.00
635,867.00

961,980.00
961,980.00

29,600.00
450.00
3,550.00
45,000.00
78,600.00
8,370.00
70,230.00
137,440.0
0

29,600.00
450.00
3,550.00
45,000.00
78,600.00
16,740.00
61,860.00
250,337.0
0

29,600.00
450.00
3,550.00
45,000.00
78,600.00
25,110.00
53,490.00
431,521.0
0

29,600.00
450.00
3,550.00
45,000.00
78,600.00
33,480.00
45,120.00

29,600.00
450.00
3,550.00
45,000.00
78,600.00
41,850.00
36,750.00

680,987.00

998,730.00

0.00
0.00

0.00
0.00

0.00
0.00

0.00
0.00

0.00
0.00

100,000.00
37,440.00
137,440.00

137,440.00
112,897.00
250,337.00

250,337.00
181,184.00
431,521.00

431,521.00
249,466.00
680,987.00

680,987.00
317,743.00
998,730.00

29

Year 4

Year 5

Total Liabilities and Owner's

Equity

137,440.0
0

250,337.0
0

30

431,521.0
0

680,987.00

998,730.00

D. Financial Analysis
a. Return on Investment
Table 8. Return on Investment
Return on Investment=(Average Annual Income/Total Project
Cost)X100

Year
1
2
3
4
5
Total Net Income
Divided by Critical
Assets Life
Average Net Income
Total Project Cost
Return on
Investment

Net
Income
37,440.00
112,897.00
181,184.00
249,466.00
317,743.00
898,730.00
5
179,746.00
94,480.00
190.25

The return on investment after considering the critical assets life

particularly some of the tools, machinery and equipment which is five years is
190.25%. Thus, the business is recommendable for the business proprietors.

31

b. Payback Period
Table 9. Payback Period

Year
1
2
3
4
5
Total Project Cost
Less Cummulative
Total where investment
is to be recovered
Total amount to be
recovered
Divided by Net
Income+Dep.
Where the investment is
recovered
Quotient
Years
Months(Multiplied by 12)
Payback Period

Net
Cummulati
Income+
ve Total
Depreciation
45,810.00
45,810.00
121,267.0
0
167,077.00
189,554.0
0
356,631.00
257,836.0
0
614,467.00
326,113.0
0
940,580.00
94,480.00

Payback
Period
1

45,810.00
48,670.00
121,267.0
0
0.40
4.82
1 year and 5 months

The payback period of the investments made by the business is 1 year

and 5 months. Since it is less than five years which is the critical life of some
assets this shows that the business is desirable as it ascertains the cash
inflows.

32

c. Net Income: Sales Ratio

Table 10. Net Income: Sales Ratio
Particula
rs
Net
Income
Sales
Ratio

Year 1
37,440.00
2,016,000.
00
1.86

Year 2
112,897.0
0
2,116,800.
00
5.33

Year 3
181,184.0
0
2,217,600.
00
8.17

Year 4
249,466.0
0
2,318,400.
00
10.76

Year 5
317,743.00
2,419,200.
00
13.13

The net income ratio shows an increasing trend from year 1 to year 5.
Thus, as the business continues, the business is growing.

E. Schedules
33

Schedule 1.1. Machinery and Equipment

Particulars
Water Dispenser
Refrigerator
Charcoal Stove
Gas Stove Set
Total

Total Cost
600.00
25,000.00
500.00
3,500.00
29,600.00

EUL
5
10
5
10

Annual Dep.
120.00
2,500.00
100.00
350.00
3,070.00

Schedule 1.2. Cleaning Tools

Particulars
Floor wiper
Tables and chairs wiper
Garbage cans
Total

Total Cost
200.00
50.00
200.00
450.00

EUL
5
5
5

Annual Dep.
40.00
10.00
40.00
90.00

Schedule 1.3. Kitchen Tools

Particulars
Plates and Bowls
Mugs and Glasses
Trays
Utensils
Cooking Materials
Total

Total Cost
700.00
500.00
150.00
200.00
2,000.00
3,550.00

EUL
5
5
5
5
5

Annual Dep.
140.00
100.00
30.00
40.00
400.00
710.00

Schedule 2.1. Furniture and Fixtures

Particulars
Food Stall Corner
Tables and Chairs
Total

Total Cost
10,000.00
35,000.00
45,000.00

EUL
10
10

Annual Dep.
1,000.00
3,500.00
4,500.00

Schedule 3.1. Direct Materials Summary

Particulars

Pre-

Year 1
34

Year 2-5

Raw Materials
Cleaning Materials
Office Supplies
Total

operation
2,780.00
50.00
20.00
2,850.00

931,300.00
2,350.00
220.00
933,870.00

934,080.00
2,400.00
240.00
936,720.00

Schedule 4. Rent Expense

Particular
s
Rent
Expense

Preoperation
8,000.00

Total

8,000.00

Particulars
Miscellaneo
us Expense

Year 1
44,000.0
0
44,000.0
0

Year 2
48,000.0
0
48,000.0
0

Preoperatio
n

Year 1
Year 2
5,040.0
5,141.0
1,000.00
0
0
5,040.0
5,141.0
Total
1,000.00
0
0
Schedule 5. Miscellaneous Expense

Year 3
48,000.0
0
48,000.0
0

Year 4
48,000.0
0
48,000.0
0

Year 5
48,000.0
0
48,000.0
0

Year 3
5,244.0
0
5,244.0
0

Year 4
5,349.0
0
5,349.0
0

Year 5
5,456.0
0
5,456.0
0

Schedule 6. Operating Costs

Particular
s

Preoperatio
n

Electricity
Water
Refill

150.00

Charcoal
Fire
Extinguish
er

1,000.00

Gas Refill
Total

0.00

800.00
650.00
2,600.00

Year 1
7,560.0
0
8,400.0
0
11,000.
00

Year 2
7,711.0
0
8,400.0
0
12,000.
00

Year 3
7,865.0
0
8,400.0
0
12,000.
00

Year 4
8,022.0
0
8,400.0
0
12,000.
00

Year 5
8,182.0
0
8,400.0
0
12,000.
00

0.00
7,150.0
0
34,110.
00

800.00
7,800.0
0
36,711.
00

800.00
7,800.0
0
36,865.
00

800.00
7,800.0
0
37,022.
00

800.00
7,800.0
0
37,182.
00

35

Schedule 8. Permits and Licenses

Particulars
Business Permit
(Sched. 8.1)

Year 1

Year 2

Year 3

Year 4

Year 5

2,450.00

2,450.00

2,450.00

2,450.00

2,450.00

DTI Registration

515.00

0.00

0.00

0.00

0.00

Cedula

75.00

75.00

75.00

75.00

75.00

Purok Clearance
Barangay
Clearance

10.00

10.00

10.00

10.00

10.00

50.00

50.00

50.00

50.00

50.00

3,100.00

2,585.00

2,585.00

2,585.00

2,585.00

Total

Schedule 8.1. Business Permit

Particulars
Billboard Fee
Sanitary Fee
Municipal ecology
Mayor's Permit
Weight and Measure
Zoning Fee
Basic Tax Clearance
Total

Amount
250.00
300.00
300.00
500.00
50.00
50.00
1,000.00
2,450.00

Schedule 9. Labor Expense

Personnel
Manager/Cashi
er
Assistant
Manager
Kitchen staffs
Table Cleaners
Food Server
Total

Total
Compensati
on per
Month

Total
Compensati
on per Year

5,000.00

60,000.00

1
2
2
2
8

4,000.00
8,000.00
5,000.00
5,000.00
27,000.00

48,000.00
96,000.00
60,000.00
60,000.00
324,000.00

No. of
Personne
l

36

Schedule 10. Sample Revenue

Particulars
Year 1
100 persons
Year 2
105 persons
Year 3
110 persons
Year 4
115 persons
Year 5
120 persons

Annual Revenue

per day @ Php 70.00

2,016,000.00

per day @ Php 70.00

2,116,800.00

per day @ Php 70.00

2,217,600.00

per day @ Php 70.00

2,318,400.00

per day @ Php 70.00

2,419,200.00

Schedule 11. Income Tax Expense

Particular
s
Income
Before Tax
Less: Basic
Amount
Excess
Multiply:
Tax
Percentage
Sub-Total
Add: Basic
Tax
Income Tax
Due

Year 1
2,016,000.0
0
500,000.00
1,516,000.0
0
0.32
485,120.00
125,000.00
610,120.00

Year 2
2,116,800
.00
500,000.0
0
1,616,800
.00

Year 3
2,217,600
.00
500,000.0
0
1,717,600
.00

Year 4
2,318,400
.00
500,000.0
0
1,818,400
.00

Year 5
2,419,200
.00
500,000.0
0
1,919,200
.00

0.32
517,376.0
0
125,000.0
0
642,376.0
0

0.32
549,632.0
0
125,000.0
0
674,632.0
0

0.32
581,888.0
0
125,000.0
0
706,888.0
0

0.32
614,144.0
0
125,000.0
0
739,144.0
0

Schedule 11.1. BIR Policy for Individual Taxpayers

If Taxable Income is:
Not over 10, 000.00
Over 10, 000.00 but not over
30,000.00
Over 30,000.00 but not over
70,000.00
Over 70,000.00 but not over
140,000.00
Over 140,000.00 but not over

Tax Due is
5%
500+10% of the excess over 10,000
2,500+15% of the excess over
30,000
8,500+20% of the excess over
70,000
22,500+25% of the excess over
37

250,000.00
Over 250,000.00 but not over
500,000.00
Over 500,000.00

140,000
50,000+30% of the excess over
250,000
125,000+32% of the excess over
500,000

38