LYCEUM OF ALABANG
College of Tourism & Hospitality Management
Bachelor of Science in Hotel Restaurant Management

CHAPTER VI

FINANCIAL STUDY

The financial study determines the profitability of the project. It focuses on

how to meet the projects’ short term objectives, to be liquid and remain liquid

during adversities, and to grow in their ability to finance their operations mostly

from net-worth sources than credit applications. This portion shows whether the

project is profitable even with existing competition and unfavorable economic

conditions.

A. FINANCIAL ASSUMPTIONS

1. The business will adopt the fiscal year of operation starting 2018.

2. All sales will be on a cash basis.

3. A 10% increase on sales starting on the second year of operation.

4. A 10% increase on production and kitchen supplies on the second year of

operation.

5. Equipment’s will be depreciated in a straight-line basis over their

economic useful life.

6. A 30% rate provisionary tax from operations.

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LYCEUM OF ALABANG
College of Tourism & Hospitality Management
Bachelor of Science in Hotel Restaurant Management

B. PROJECT COST

Initial Capital Requirement

Initially, the business will require a total of P 580,599.00. enough to cover

all its operating cost and expenses on the first year of operation. It will be

equally borne and contributed by the members.

C. SOURCES OF FINANCING

Our source of nature and funding will be equally distributed to

each proponent of Marple – Baked Apple Stuffed with Blue Marlin topped

with cheese.

Members contribution:

Marjon Samson P 116,119.80

Classmate 1 P 116,119.80

Classmate 2P 116,119.80

Classmate 3 P 116,119.80

Classmate 4 P 116,119.80

Total P 580,599.00

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LYCEUM OF ALABANG
College of Tourism & Hospitality Management
Bachelor of Science in Hotel Restaurant Management

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LYCEUM OF ALABANG
College of Tourism & Hospitality Management
Bachelor of Science in Hotel Restaurant Management

Table 10: Project Cost

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LYCEUM OF ALABANG
College of Tourism & Hospitality Management
Bachelor of Science in Hotel Restaurant Management

Table 11: Projected Income Statement

Table 12:
Projected Cashflow
Statement

Table 13:
Projected Balance
Sheet Statement

FINANCIAL

ANALYSIS

A. RETURN

ON INVESTMENT

Computation:

ROI = (NET

INCOME

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LYCEUM OF ALABANG
College of Tourism & Hospitality Management
Bachelor of Science in Hotel Restaurant Management

/INVESTMENT) 100

Application:

ROI = (175,048.30/580,599.00) 100

= (0.3014960411574942) 100

ROI = 30.15%

B. PAYBACK PERIOD
Computation:

P.B. = (Total Project Cost/Net Income)

Application:

P.B. = (580,599.00/175,048.30)

P.B. = 3.3 Years

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