A project feasibility analysis does not necessarily have to include all of the financial details

which are required for business plan financial projections. However, it must include reasonable
estimates about the financial expectations from the business.

The purpose of the financial study is to determine the financial feasibility of a project or
business. One of the areas of investigation would include a comparison of the financial cost of
the projects implementation and operations with the expected income over the projects lifetime.

Financial analysis refers to the assessment of the projects commercial profitability in spite of the
existing competition and unfavorable economic conditions. It will also show the improvement of
the projects financial condition over time.

The basic reference of revenue generating projects are the marketing study, from which
indications of the expected output, demand, and price trends may be inferred from; and the
technical study, since volume and value of the projected output also depend on the capacity and
other technical features of the project.

Considering the uncertainty of the future events, it is often necessary to make certain
assumptions concerning the specific value and the quantities for the various accounts which will
be used in the preparation of the financial statements and the projections thereafter.

I. MAJOR ASSUMPTIONS

In projecting the financial statements of Le Circuit Mobile Bar, the following

assumptions shall be made. The major suppositions of the different real and nominal
accounts shall provide consistency and more accurate projections of the future
revenue and expenditure items.

1. Sales
Gross Sales consists of 100% cash sales.
Unit Sales are presumed to increase by
The selling price of the products is expected to increase by 2% annually, which is
estimated average inflation rate.
The expected sales viand were obtained by multiplying annual expected sales by the
percentage demand of such viand in relation to all other viands which were chosen to be
offered which can be found in the Market Aspect of this study.

2. Cost of Goods Sold

 All purchases will be paid on a cash basis.
The cost of the products is expected to increase by 4.1% annually which is
estimated average inflation rate.

3. Operating Expenses

Operating Hours is 8 hours per day.

The straight line method of depreciation is used for computing the
depreciation expense of the non-currentb assets.
 BALANCE SHEET

1. Current Asset
The company will set up a petty cash fund at a maximum of 10,000.
The cash on hand in excess of the P10,000 petty cash fund will be kept by
the general manager.
The cash on bank is entered in a regular checking account of Metrobank
wherein the said regular checking account does not incur any interest.

2. Non-Current Asset

Purchases of the machineries, equipment, tools, furniture and fixtures to

start the business are all paid for cash contributed by the partners for the
project.

3. Liability

SSS Payable, Phil Health Payable and PAG-IBIG Payable represent

contributions for the last month. Remittances for the contributions are
made the 10th day of the following month.
Income Tax is paid on a quarterly basis.

4. Partners Capital

The partnership consists of three general partners.

Profit and loss will be divided equally among partners.
The partners have their withdrawals equally in each year.

II. SOURCES OF FINANCING

The three proponents of the business will contribute cash amounting to Php
1,500,000 each as their initial investment, shown as follows:

PARTNER CONTRIBUTION
Cabais, Rizel P 1,500,000
Mangaoang, Ledilyn P 1,500,000
Mina, Eloisa P 1,500,000
TOTAL P 1,500,000

IV. Preparation of Financial Statements

 Financial Statements present in an orderly and understandable from the cash
budget, the operating performance and the financial condition of a business
enterprise. The statements depict the financial progress of the firm for a span of 5
projected years.