Every business provides financial management with enough to

decide whether the financial product will benefit with intended users. The business
should know how much starting income is needed to build and run the business. The
process of financial planning in business is designed to forecast future financial
resort and determine how best to use the company’s financial resources in pursuit of
the organizations sort and long-range objectives because planning involves looking
well into the future, it is a highly creative thinking process as well as an analytical
one. Financial planning takes the actions described in the strategic plan. The
financial plan shows the projected revenues from the implementation of the
strategies. The accuracy of the financial plan depends on the quality of information
used in the assumptions for the financial plan.

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A. Total Project Cost

The table shows the project costs including the fixed assets, working capital and
its pre-operating expenses.

DESCRIPTION COST
Production Cost (One year of operation)
Raw Materials 332,767.68
Packaging 24,258.84
Labor 125,562.96

Fixed Assets
Equipment 31,790
Fixtures 1,100
Stall 25,000
Tools 5,138
Rental Expense 50,400
Selling Expenses 2,000
Gas 6,000
Water Expenses 6,000
Electricity 12,000
Transportation expenses 3,600
Permits and licenses 5,000
TOTAL ₱630.617.48

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B. Project Cost Allocation

The graph below shows the allocation of the project cost including the production
cost, rent expenses, fixed asset, and pre-operating expenses in percentage.

PROJECT COST ALLOCATION

Production cost Fixed Assets Rental Expense

Selling Expenses Gas Water Expenses
Electricity Transportation expenses Permits and licenses

Figure 1: Project Cost Allocation Chart

C. Source of Financing
This table shows the total contribution of every proponents.

Name of Partners Contribution

Aikhin Vibar ₱ 50,000.00
Clarice Garciso ₱ 50,000.00
Jenie Gomez ₱ 50,000.00
Cheryl Barbadillo ₱ 50,000.00
Jayden Agravante ₱ 50,000.00
TOTAL CONTRIBUTION ₱ 250,000.00

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D. Statement of Financial Assumptions

1. The proponents used the calendar year for the business.

2. All sale transactions are presumed to be on a cash basis.
3. The Proponents assumed that a total of 1050 scotch eggs will be produced
for the first 24 weeks or 25,200 scotch eggs for the first six months. It is
further assumed that it will increase by five (5) percent every six months
for the succeeding years.
4. It is presumed that total production of scotch eggs is equal to the number
of scotch eggs sold. Hence, all units produced are sold.
5. The proponents assumed that all fixed Assets, except for the tools, will be
depreciated using the straight live method and will a 10% salvage value at
the end of its useful life. Moreover, the following are the useful lives and
the costs of the fixed assets:

Item Useful Life

Spoons 3
Forks 3
Disposable Box 3
Knives 3
Ladles 3
Tongs 3
Strainer 3
Chopping Board 3
Big Bowl 3
Small Bowl 3
Saucer 5
Transparent container 3
Big Tupperware 3
Plates 3

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EQUIPMENTS

Item Useful Life

Refrigerator 10
Trash Can 3
Fire 2
Extinguisher
Cash Register 2
Machine
Stove 4
Frying Pan 4
Pot 4

STALL

Item Useful Life

Stall 5

FURNITURE AND FIXTURES

Item Useful life

Chair 5
Table 5

6. The proponents assumed that all scotch eggs will be sold every year.
7. The proponents assumed that the daily rent in the land for ₱150 will not
change for the first three year.
8. Income tax rate is 30%.
9. Net income or loss will be distributing to every partner equally.
10. Partner’s initial investment is ₱ 50,000 each.
11. Salaries for the service crew/cashier are ₱365 per day.
12. Utilities expense will be as follows:

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 Electricity ₱ 1,000 per month

Water bill ₱ 500 per month

Gas ₱500 per month

13. Transportation expenses for every month are ₱300.

14. Permits and Licenses will be ₱25,000 every year.
15. Selling expenses will be ₱2,000 every year.

E. Projected Income Statement

This table shows the projected income statement of the Scotch egg in the years 2019,
2020 and 2021.

SCOTCH EGG

Income Statement
2019 2020 2021
Sales ₱775,080 ₱ 854,820 ₱942,390
Less: Cost of Sales (482,616.48) (532,267.92) (586,794.84)
Gross Profit ₱ 292,463.52 ₱322,552.08 ₱355,595.16
Less: Operating Expense
General and Admin (₱94,808.42) (₱94,808.42) (₱94,808.42)
Exp.
Selling Expenses (2,000) (2,000) (2,000)
Net Income ₱200,200.04 ₱ 225, 743.66 ₱ 258,786.74

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F. Schedules

This table shows the Sales in volume of the Scotch Egg for the years 2019, 2020 and
2021.

SCHEDULE 1

SCOTCH EGG
Sales in Volume

MONTH/ YEAR 2019 2020 2021

January 4,200 4,633 5,108

February 4,200 4,633 5,108

March 4,200 4,633 5,108

April 4,200 4,633 5,108

May 4,200 4,633 5,108

June 4,200 4,633 5,108

July 4,412 4,865 5,363

August 4,412 4,865 5,363

September 4,412 4,865 5,363

October 4,412 4,865 5,363

November 4,412 4,865 5,363

December 4,412 4,865 5,363

TOTAL ₱2,672 ₱56,988 ₱62,826

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 This table shows the Sales in peso of the Scotch Egg for the years 2019, 2020 and
2021.

SCHEDULE 2

SCOTCH EGG
Sales in Peso
YEAR Unit Sold Sales Price/Unit Sales (Peso)
2019 51,672 15 775,080
2020 56,988 15 854,820
2021 62,826 15 942,390

This table shows the Fixed Asset Depreciation of the Scotch Egg for the years 2019,
2020 and 2021.

SCHEDULE 3

FIXED ASSET DEPRECIATION

Total Salvage Depreciable Depreciation Book Value
Cost Value Amount Expense per
year

2019 2020 2021

STALL 25,000 2,500 22,500 4,500 20,500 16,000 11,500

EQUIPMENT

Refrigerator 13,000 1,300 11,700 1,170 11,830 10,660 9,490

Other equipment 18,790 1,879 16,911 4,227.75 14,562.25 10,334.25 6,106.75

TOOLS 5,138 - 5,138 1,712.67 3,425.33 1,712.66 0

FURNITURES AND 1,100 110 990 198 902 704 506

FIXTURES
TOTAL 63,028 5,789 57,239 11,808.42 51,219.58 39,410.91 27,602.75

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This table shows the Cost of Goods Sold of the Scotch Egg product for the years
2019, 2020 and 2021.

SCHEDULE 4
COST OF GOODS SOLD
DESCRIPTION 2019 2020 2021
Raw materials 332,767.68 367,002.72 404,599.44
Direct Labor 125,562.96 138,480.84 152,667.18
Packaging 24,285.84 26,784.36 29,528.22
TOTAL ₱482,616.48 ₱532,267.92 ₱586,794.84

This table shows the General and administrative expenses of the Scotch Egg product
for the years 2019, 2020 and 2021.

SCHEDULE 5
GENERAL AND ADMINISTRATIVE EXPENSES

DESCRIPTION 2019 2020 2021

Depreciation ₱ 11,808.42 ₱ 11,808.42 ₱ 11,808.42
Expense

Rental Expenses 50,400 50,400 50,400

Permit and 5,000 5,000 5000
Licenses

Gas 6,000 6,000 6,000

Water Expenses 6,000 6,000 6,000
Electricity 12,000 12,000 12,000
Transportation 3,600 3,600 3,600
expenses

TOTAL ₱ 94, 808.42 ₱ 94, 808.42 ₱ 94, 808.42

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This table shows the Selling and marketing expense that the proponents will
contribute of the Scotch Egg product for the years 2019, 2020 and 2021.

SCHEDULE 6
SELLING AND MARKETING EXPENSE
DESCRIPTION 2019 2020 2021
Flyers ₱1,000 ₱1,000 ₱1,000
Tarpaulin 1,000 1,000 1,000
Total ₱2,000 ₱2,000 ₱2,000

This table shows the fixed cost and variable cost that the proponents will contribute
of the Scotch Egg product for the years 2019, 2020 and 2021.

SCHEDULE 7
FIXED COST AND VARIABLE COST
2019 2020 2021
Fixed cost
Depreciation ₱ 11,808.42 ₱ 11,808.42 ₱ 11,808.42
Expense
Rental Expense 50,400 50,400 50,400
Selling Expenses 2,000 2,000 2,000
Gas 6,000 6,000 6,000
Water Expenses 6,000 6,000 6,000
Electricity 12,000 12,000 12,000
Transportation 3,600 3,600 3,600
expenses
Permits and licenses 5,000 5,000 5,000
TOTAL ₱ 96, 808.42 ₱ 96, 808.42 ₱ 96, 808.42
Variable Cost
Raw Materials 332,767.68 367,002.72 404,599.44
Direct Labor 125,562.96 138,480.84 152,667.18
Packaging 24,285.84 26,784.36 29,528.22
TOTAL ₱487,616.48 ₱537,267.92 ₱591,794.84
GRAND TOTAL ₱574,424.90 ₱624,076.34 ₱678,603.26

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