ATEEN Enterprises Group 2 401A

Financial Assumptions

1. Statement of Financial Position (Balance Sheet) Assumption

1.1 Assets

The total capital investment is 1,000,000.

2. Income Statement Assumption

2.1 Sales Revenue

The selling price is determined with average mark-up rate of

100%.

The ending raw materials is 10% of the raw materials available

for use.

The ending finished goods is 10% of the goods available for

sale.

The projected sales for 2018 is based on 90% of the units

produced.

The gross profit is 60.85% of the projected sales.

2.2 Expenses

The allocation for factory, office and store rent expense is 50%,

25% and 25%, respectively

The allocation of factory, office and store utilities expense is

40%, 30% and 30%, respectively.

The repairs and maintenance expense is 10% of the total

accumulated depreciation allocated to factory, office and store

1
ATEEN Enterprises Group 2 401A

which is 60%, 20% and 20%, respectively.

The advertising expense is P12,000 which includes the cost of

poster, flyers and tarpaulin.

Vacation leave and sick leave are monetized and paid every

year according to the policy. Assume the following:

Male female Total

Single 5 5 10
Married 1 2 3
Total 6 7 13

2
ATEEN Enterprises Group 2 401A

Ateen Enterprises
Statement of Comprehensive Income
For the year ended December 31, 2018

(Note)
Sales (1) 3,217,500.00
Less: Cost of Goods Sold (2) 1,259,505.00
Gross Profit 1,957,995.00
Less: Operating Expenses
Selling Expenses (3) 348,309.14
Administrative Expenses (4) 1,569,817.05 1,918,126.19

Net Income (Loss) (39,868.81)

3
ATEEN Enterprises Group 2 401A

Net 1-Sales

Gross Sales (58,500x 55) 3,217,500.00

Less: Sales Return 0
Sales Discount 0

Net Sales 3,217,500.00

Note 2- Cost of Goods Sold

Beginning Raw Materials 0

Add: Raw Materials Purchases 100,020.00
Raw Materials Available for Use 100,020.00
Ending Raw Materials 10,002.00
Raw Materials Used 90,018.00
Direct Labor 110,500.00
Manufacturing Overhead 1,240,200.00
Total Manufacturing Cost 1,461,498.00
Beginning Goods in Process 0
Total Cost of Goods in Process 1,440,718.00
Ending Goods in Process 41,268.00
Cost of Goods Manufactured 1,399,450.00
Beginning Finished Goods 0
Goods Available for Sale 1,399,450.00
Ending Finished Goods 139,945.00

Cost of Goods Sold 1,259,505.00

4
ATEEN Enterprises Group 2 401A

Note 3- Selling Expenses

Sales Salaries 240,000.00

SSS, Philhealth and HDMF 1,898.40
Rent Expense-Store 75,000.00
Utilities Expense-Store 18,000.00
Repairs and Maintenance Expense 37.34
Advertising Expense 12,000.00
Store Supplies Expense 1,000.00
Depreciation Expense- Store 373.40

Total 348,309.14

Note 4- Administrative Expenses

Office Salaries 1,281,600.00

SSS, Philhealth, and HDMF 8,019.80
Rent Expense-Office 75,000.00
Utilities Expense- Office 18,000.00
Repairs and Maintenance Expense 2,066.50
Office Supplies Expense 5,095.75
Depreciation Expense- Office 20,665.00
Other Benefits (VL, SL, ML & PL)
Vacation Leave (VL) 37,775.00
Sick Leave (SL) 37,775.00
Maternal Leave (ML) 79,200.00
Paternal Leave (PL) 4,620.00

Total 1,569,817.05

5
ATEEN Enterprises Group 2 401A

Supporting Computations

Number 13th VL SL ML PL
of Month
Position
Worker Pay
s
General 1
Manager*+ 33,000 8,250 8,250 0 0
Secretary*++ 1 11,000 2,750 2,750 0 0
Production 1
Supervisor **+ 14,300 3,575 3,575 0 4,620
Purchasing 1
Staff **++ 13,200 3,300 3,300 39,600 0
Accounting 1
Staff**++ 13,200 3,300 3,300 39,600 0
Sales/Marketin 2
g Staff *++ 26,400 6,600 6,600 0 0
Cashier*++ 2 20,000 5,000 5,000 0 0
Production 3
Workers *+ 30,000 7,500 7,500 0 0
Security Guard 1
(Agency) *+ 10,000 2,500 2,500 0 0
37,77 37,77 79,20 4,62
Total 13 171,100 5 5 0 0
*single
**married
+male
++female

6
ATEEN Enterprises Group 2 401A

Table 41
Depreciation Charged to Overhead

Particulars Total Residual Depreciable Project Life Depreciation

Cost Value Amount Span
(Years)
Liquid 17,500.00 1,000.00 16,500.00 10 1,650.00
Boiling
Machine
Liquid Filling 18,000.00 1,500.00 16,500.00 10 1,650.00
Machine
Industrial Air 20,000.00 2,000.00 18,000.00 10 1,800.00
Conditioner
(Cooling
device)
Water Spray 250.00 - 250.00 5 50.00
Extinguisher
Powder 250.00 - 250.00 5 50.00
Extinguisher
Ventilation 6,000.00 - 6,000.00 10 600.00
Water 1,500.00 - 1,500.00 5 300.00
Cooler
Inventory 6000.00 600.00 5,400.00 5 1,080.00
Shelves
Tables 6,000.00 - 6,000.00 10 600.00
Chairs 900.00 - 900.00 10 90.00
Cabinet 9,000.00 500.00 8,500.00 10 850.00
Trash bins 1,167.00 - 1,167.00 5 233.40

Total Php8,953.40
Depreciatio
n

7
ATEEN Enterprises Group 2 401A

Table 42
Depreciation Charged to Expense

Particulars Total Residual Depreciable Project Depreciation

Cost Value Amount Life Span
(Years)
Water Spray 250.00 - 250.00 5 50.00
Extinguisher
Powder 250.00 - 250.00 5 50.00
Extinguisher
Computer 84,950.00 2,000.00 82,950.00 10 8,295.00
Set
Printer 15,000.00 1,500.00 13,500.00 10 1,350.00
Water 1,500.00 - 1,500.00 5 300.00
Cooler
Telephone 4,500.00 - 4,500.00 5 900.00
Air 15,000.00 1,000.00 14,000.00 10 1,400.00
conditioner
Chairs 900.00 - 900.00 10 90.00
Office Desk 24,000.00 1,000.00 23,000.00 10 2,300.00
Office Chair 30,000.00 1,000.00 23,000.00 10 2,300.00
Desk 9,000.00 500.00 8,500.00 10 850.00
Drawer 30,000.00 800.00 29,200.00 10 2,920.00
Filling
Cabinet
Trash bins 1,167.00 - 1,167.00 5 233.40

Total Php21,038.40
Depreciatio
n

8
ATEEN Enterprises Group 2 401A

Raw Materials Requirements

Table 43
Raw Materials
Unit
Item Quantity Unit Cost Total Cost
Measurement
Beeswax 1pound/16 ounce 1 ounce Php8.33 Php8.33

Coconut Oil 30ml/1ounce 1 ounce 5.00 5.00

Sweet Almond Oil 30ml/1ounce 2 tbsp. 40.00 80.00

1ounce/2tbsp
Coconut Essential 30ml/1ounce 1 ounce 5.00 5.00
Oil
Aluminum Tin Can 7.8 cm length 7.8 125pcs 15.00 1,875.00
(Customized) cm width 2.54 cm
height for a
volume of 155
square
centimeter.
Carton Boxes 1 20.00 20.00

Total Raw Php93.33

Materials Cost per Php1,993.33
batch
Divide by units per 125 125
batch

Raw Materials Php0.75 Php15.95

Cost per unit

References:
http://www.indexmundi.com/commodities/?commodity=coconut-oil&currency=php
https://www.alibaba.com/showroom/beeswax.html
http://www.coconutoil-online.com/measuring_coconut_oil.html
https://www.mybenta.com/tag?q=sweet-almond-oil

9
ATEEN Enterprises Group 2 401A

Production Cost/Unit Cost

Table 44
Production Time
Time Needed
Activity (in minutes)
Preparation of raw materials, machinery and equipment 15
Adding beeswax and coconut oil 5
Melting process 30
Adding sweet almond and oil 10
Filling process 30
Cooling process 60
Quality Control 30
Packaging 45

TOTAL PROCESS TIME PER BATCH 225

(3.75 hours)

Table 45
Direct Labor Cost
COCO de MANZANA
Rate per Hour of Labor PhP56.82
(PhP454.54/8hrs)
Multiply Production in Time (Batch in Hours) 3.75
Total Direct Labor Cost per Batch 213.07
Divide Units Produced per Batch 125

Direct Labor Cost Per Unit PhP1.70

10
ATEEN Enterprises Group 2 401A

Table 46
Manufacturing Overhead
Estimated Expected
Manufacturing Overhead
Overhead Cost Activity
Rent (Php25, 000 x 50%) Php12,500 250pcs/100grams
Utilities (Energy, Water) 2,000
(5000 x 40%)
Salaries (Php33,000x1) 33,000
Depreciation (Php8,953.40/12) 746.12
SSS 3,278.30
Production Supervisor (Php1,068.20x1)
Production Workers (Php736.70x3)

Pag-IBIG (4 x Php100) 400

Philhealth 512.50
Production Supervisor (Php175x1)
Production Workers (Php112.50x3)
Employers Contribution (EC) (Php10x4) 40

Total Manufacturing Overhead Cost per Month Php52,476.92

Table 47
Operating Expenses
Annual Monthly Daily
Rent Expense Php150,000 Php12,500 Php568.18
(25,000x 50%)
Utilities Expense 36,000 3,000 136.36
(Php5000x60%)
Salaries Expense (See 1,521,600 126,800 5,763.64
Table 50)
SSS (8) 87,508.80 7,292.40 331.47
Pag-IBIG (8) 9,600 800 36.36
Philhealth (8) 17,100 1,425 64.77
Employers Contribution 1,200 100 4.55
(EC)
Depreciation Expense 21,038.40 1,753.20 79.69

Total Operating Expense Php1,844,047.20 Php153,670.60 Php6,985.02

11
ATEEN Enterprises Group 2 401A

Table 48
Product Cost per Unit
COCO de MANZANA
Direct Materials Php0.75
Direct Labor 1.70
Manufacturing Overhead
(Php52,476.92/22days=Php2,385.31)
(Php2,385.31/125pcs) 19.08

Product Cost per Unit Php21.53

Table 50
Projected Human Resources Expenses

SSS PhilHealth Pag-IBIG Employers

Monthly
Position (Employer (Employer (Employer Contribution
Salary
Share) Share) Share)
General Manager Php33,000 1,178.70 412.50 100.00 30
Secretary 11,000 810.30 137.50 100.00 10
Purchasing Staff 13,200 957.70 162.50 100.00 10
Accounting Staff 13,200 957.70 162.50 100.00 10
Sales/Marketing Staff 26,400 1,915.40 325.00 200.00 20
(Php13,200x2)
(957.70X2)
(162.50x2)
(10x2)
Cashier 20,000 1,473.40 225.00 200.00 20
(Php10,000x2)
(736.70x2)
(112.50x2)
(10x2)

Security Guard 10,000 - - - -

(Agency)
Projected Annual
Salary Expense Php126,800 7,293.20 1,425.00 1,200.00 100

1. Vacation leave and sick leave (with pay or without pay) must be

approved by the owner at least three working days prior to the actual

12
ATEEN Enterprises Group 2 401A

vacation date. They have paid leave for 5 days in a year based on the

basic gross salary per year and not lower than the daily rate.

2. Maternal Leave

This will be allowed for every woman employees in accordance to

the Social Security Law and Social Security System Circulars for sixty (60)

calendar days for normal delivery and (78) calendar days for caesarian

delivery that are paid and (150) calendar days paid leave for single

mothers depending on the circumstances and situation of maternity. Paid

based on the basic gross salary but nor lower than the daily rate. Use 60

days as default.

3. Paternal Leave

This will be allowed for every man employees in accordance to

Republic Act no. 8187 for seven (7) days especially for the recovery

and nursing of his wife and new-born child. Based on the basic gross

salary but not less than the daily rate.

13th Month Pay

All employees are entitled to a 13th month pay for not less than 1/12

of their total basic calendar year salary. It is computed pro rata according

to the months within a year that the employee has rendered service to the

employer. It is given at the second week of December.

Social Security System (SSS), PAG-IBIG Fund Home Development

Mutual Fund (HDMF), and Philippine Health Insurance (PHILHEALTH)

13
ATEEN Enterprises Group 2 401A

SSS, Pag-IBIG and PhilHealth will be deducted to the gross salary

and remitted to the respective government agency.

14