CHAPTER FIVE
FINANCIAL PLAN
5.1 [Link] COST
Item Ksh
Insurance 12,000
Postage 1,000
Electricity 1,000
Transport 46800
Advertising 3,000
License 12,000
Water 1500
Purchases 186,000
miscellaneous 20000
Maintenance 1,300
Rent 9,000
Total 300000
5.2 WORKING CAPITAL
Current assets 2023 2024 2025
Cash at hand 200000 314100 1358890
Debtors 11750 17100 20200
Total current assets 211750 331200 1379090
Current liabilities
Bank loans 130000 80000 60,000
Creditors 40000 20000 15,000
Total current 170000 100000 75,000
liabilities
WC=CA-CL 170000 244000 1310690
5.3 PROJECTED CASH FLOWS STATEMENT
5.3.1 PROFORMA CASH FLOW FOR FAITH CHEPS QUARRY BLOCK CONSTRUCTION COMPANY FOR YEAR 2023
Receipts JAN FEB MAR APR MAY JUN JULY AUG SEP OCT NOV DEC TOTAL
Capital 300000 300000
Debtors 1000 500 2000 750 1050 900 500 1000 950 600 500 2000 11750
Sales 98000 100000 90000 85000 110000 95000 100000 105000 101000 104000 102000 100000 1172000
Total Receipts 299000 100500 92000 85750 111050 95900 100500 106000 101950 104600 102500 102000 1433750
Purchase 186000 50000 20000 10000 266000
License 12000 12000
Insurance 12000 12000
Advertisement 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 36000
Electricity 1000 1500 900 500 200 100 300 500 1000 500 450 1200 8150
Water 1500 1000 1200 1300 1100 1400 1000 1200 1100 1500 1000 950 14250
Rent 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000
Miscellanies 23050 23050
Salaries 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 1152650
Total payment 290650 70600 70200 69900 69400 69600 698400 69800 70200 70100 69550 70250 1139650
Net profit 8350 29900 21800 15850 41650 26300 31100 36200 31750 34500 32950 31750 314100
B/d 8350 38250 60050 75900 117550 143850 146950 183150 214900 249400 282350 314100
5.3.2 PROFOMA CASH FLOW FOR FAITH CHEPS QUARRY BLOCK CONSTRUCTION COMPANY FOR YEAR 2024
Receipts JAN FEB MAR APR MAY JUN JULY AUG SEP OCT NOV DEC TOTA
L
B/C 314100 314100
Debtors 2000 1500 1900 1800 1000 1200 900 1700 1400 1200 1500 1000 17100
Sales 180000 185000 190000 195000 181000 192000 189000 180000 193000 183000 192000 191000 225100
0
Total receipts 496100 186500 191900 196800 182100 193200 189900 181700 194200 184200 193500 192000 262920
0
Purchase 190000 180000 50000 30000 350000
License 12000 12000
Insurance 12000 12000
Advertisement 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 2000 24000
Electricity 1000 500 900 800 600 700 300 200 850 750 950 400 7950
Water 15OO 1300 1100 950 1000 1400 800 750 1000 600 500 400 11300
Rent 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 108000
Miscellaneous 28360 28360
Salaries 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 673200
Total payment 311960 68900 69100 68850 248700 69200 68200 68050 118950 68450 68550 97900 122681
0
Net profit 184140 117600 122800 127950 33400 124000 121700 117250 75250 115750 124950 94100 135889
0
B/d 184140 301740 424540 522490 585890 709890 831590 948840 102409 139684 126479 135889
0 0 0 0
5.3.3 PROFOM CASH FLOW FOR FAITH CHEPS QUARRY BLOCK CONSTRUCTION COMPANY FOR YEAR 2025
Receipts JAN FEB MAR APR MAY JUN JULY AUG SEP OCT NOV DEC TOTA
L
B/C 1358890 135889
0
Debtors 1000 2000 1500 3000 2500 24000 1700 1800 1900 900 500 1000 20200
Sales 120000 125000 130000 126000 123000 121000 127000 129000 124000 128000 131000 122000 150600
0
Total receipts 1479890 127000 131500 129000 125500 123400 128700 130800 125900 128900 131500 123000 293209
0
Purchase 191000 50000 241000
License 12000 12000
Insurance 12000 12000
Advertisement 2000 2000 4000
Electricity 1000 500 900 1000 800 950 650 700 850 400 300 200 8250
Water 900 700 1000 800 950 500 450 350 850 700 750 600 8550
Rent 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 9000 108000
Miscellaneous 140589 140589
Salaries 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 56100 673200
Total payment 424589 66300 67000 66900 66850 116550 68200 66150 66800 66200 66150 65900 120339
9
Net profit 1055301 60700 64500 62100 58650 6850 60500 64650 59100 62700 65350 57100 167750
1
B/d 1055301 111600 118050 124260 130125 130810 136860 143325 149235 155505 162040 167750
1 1 1 1 1 1 0 1 1 1 1
5.4 BALANCE SHEET
Particulars 2023 2024 2025
Current assets
Cash at hard 200000 314100 1358890
debtors 11750 17100 20200
Total currents assets 211750 331200 1379090
Fixed assets
Purchases 186000 190000 191000
Depreciation (6%) 15960 21000 14460
After depreciation 250040 329000 226540
Total assets 452000 540000 432000
Current liabilities
Bank loan 130000 80000 60000
Creditors 40000 20000 15000
Total current liabilities 170000 100000 75000
Owners’ equity 67000 200000 200000
Retained earning 131790 374050 1362340
Total liability 452,000 540,000 432,000
5.5 PROFORMA INCOME STATEMENT
Particulars 2023 2024 2025
Sales 1172000 2251000 1506000
debtors 11750 17100 20200
Gross profit 1183750 2268100 1526200
Electricity 8150 7950 4000
Insurance 12000 12000 12000
License 12000 12000 12000
Advertisement 36000 24000 4000
Purchase 266000 350000 241000
Rent 673200 673200 673200
Water 108000 108000 108000
Miscellaneous 14250 11300 8550
Total expenses 1152650 1226810 1203339
Net profit (GP-TE) 731100 1041290 322861
Tax 6% P.A 43866 62477 19372
Net profit after 687234 978813 303489
tax(NP-T)
5.6 PROFITABILITY RATIO
TYPE OF WORKING YEAR 2023 YEAR 2024 YEAR 2025
RATIO FORMULA
Gross profit ratio Gross profit * 100 1183750 * 100 2268100 * 100 1526200 * 100
sales 1172000 2251000 1506000
101% 101% 101%
Return on equity Profit after 45073 * 100 995601 * 100 425350 * 100
tax*100 Total 250000 250000 250000
investment
18.03% 398.2% 170%
5.7 BREAK EVEN ANALYSIS
Particulars 2023 2024 2025
Variable cost purchase 266000 350000 241000
Total variable 266000 350000 241000
Fixed cost
Electricity 8150 7950 4000
Insurance 12000 12000 12000
License 12000 12000 12000
Advertising 36000 24000 4000
Salaries 673200 673200 673200
Rent 108000 108000 108000
Water 14250 11300 8550
Miscellaneous 6200 10500 10950
Total fixed 869800 858950 832700
Total contribution 1172000-266000 2251000-350000 1506000-241000
Margin=sales-total =906000 =1901000 =165000
variable cost
Total contribution 906000 * 100/ 1901000 * 100/ 1265000 * 100/
margin 117200 2251000 1506000
percentage=contributio
77.3% =84.5% =84%
n margin *100
sales
Breakeven of sales 869800 * 100/ 858950 * 100/ 832700 * 100/
77.3 84.5 84
In shillings=fixed
cost*100 margin =1125226 =1016508 991309
percentage
5.8 PROPOSED CAPITALIZATION
ITEM AMOUNT
Owners contribution 150000
Friends and Family 100000
Bank Loan 50000
Total Capital 300000