College of Business Administration Education

2nd Floor, SS Building

Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Kamote Nation

**REFERENCE EXAMPLE ONLY, DO NOT COPY!!!**

A Business Proposal
College of Accounting Education

In Partial Fulfillment of the Requirement for the Subject BE 313 –

Managerial Economics Second Term Second Semester SY
2019-2020 11:00 am – 12:00 pm

Submitted to:
ADRIANE JOHN P. LUNCIDO, EnP., MSEco

Submitted by:
Group 1
Cabugatan, Jihan
Falconite. Jorien
Leong, Shiela
Libres, Criselle
Naong, Twinkle
Sanchez, Kyla
Supan, Jemelle

March 10, 2020

 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

TABLE OF CONTENTS

I. Description of the Proposed Business ------------------------------------------59

II. Proposed Product or Service ------------------------------------------------------60

III. Target Market -----------------------------------------------------------------------------66

IV. Competitors -------------------------------------------------------------------------------68

V. Marketing Strategies / Realization of the Proposed Business ----------------70

VI. Location/ Production ----------------------------------------------------------------74

VII. Management --------------------------------------------------------------------------75

VIII. Cost of Production and Pricing Strategies ----------------------------------------77

IX. Projected Financial Statement (1 year) ----------------------------------------79

 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

I. Description of the Proposed Business

There are many reasons why people eat snacks. It could be down to hunger and the
need to eat, or because of “distracted eating” – eating too much food while playing games,
watching TV or chitchatting with friends. Junk foods, Pizza, burgers, cakes, breads and other
high-calorie snacks are the common snacks that most people consumes nowadays. But also,
most people do not realize just how much these snacks are unhealthy and bad for their
health. The wide range of snacks available to the market is now evident in all outlets. But
again, most of these snacks are not healthy. If people are hungry, they eat what is there. So,
by providing healthy options at an affordable price it should help people make better choices.
Kamote Nation is a business partnership comprises with 7 Accountancy students in
The University of Mindanao. The reason why we have come up with the idea in putting up
Kamote Nation is that we are all snack-lovers but at the same time health-conscious. UM’s
canteen offers unhealthy snacks and even when you go outside the campus there are a lot of
tempting foods/snacks that again, are not healthy. Such as fried chicken skin, pizza rolls, junk
foods, shawarma and many more. Another reason is that we are always busy because of our
personal schedules that sometimes we forgot to have a meal. The way people live today is
changing the way we eat. Many people are now seeking for on-the-go foods/snacks that are
healthy. Kamote Nation’s goal is to provide a delicious, healthy and affordable on-the-go
snack that can satisfy the taste buds and budget of our customers. Kamote Nation also aims
to build a nation that can see kamote as not just the ordinary kamote that we knew growing up
and that kamote or sweet potatoes has lot of things to offer. Sweet potatoes are Kamote
Nation’s main ingredient in producing their product because of its health benefits and
affordable price in the local market. Aside from that, majority of the supplier of sweet potatoes
that we can see in our local markets here in Davao City, are from Marilog District. Sweet
potatoes are one of their main crops. Many IPs (Indigenous People) sells sweet potatoes for
their living. We want to contribute and somehow help them by buying sweet potatoes from the
local market that the IPs supplied and use it for making our proposed product.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Company Slogan
Kamote Nation’s slogan is “Make life sweeter with sweet potatoes” Filipinos have a
bad association with Kamote; for us who have gone through school, every time we are having a
hard time answering those tricky and difficult questions in the examination and would get low
grades we were called by our classmates–“nangangamote”. Unfortunately, this has long been
used term for losers. It has also been a long running joke for some students, who get a low grade,
and when their relatives will throw them banter and say just go to the mountains and plant kamote
“Mamundok ka nalang at magtanim ng kamote”. But, in spite of its bad connotation, Kamote is
very nutritious, it provides lots of benefits in our body, and an important food source in our country.
Kamote is not just the kamote that we knew before, many farmers and local sellers are earning
money because of kamote. It can make life sweeter because it contains a lot of health benefits
that can make a person’s life more “liveable”.

Company Logo

Our company logo is purple to represent the color of sweet potatoes when they are not
peeled-off and also purple is an attractive color it may attract customers. The left sweet potato
cartoon shows a thumbs-up that means our product is a must-try food snack. On the other
hand, the right sweet potato cartoon’s left arm is open meaning everyone is encouraged to try
and be one with us in the Kamote Nation.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

II. Proposed Product or Service

The Kamote Nation strive to penetrate the market with a “bang”. Thus, we’ve come up with
a product that is new to the market and is very affordable and healthy. Instead of just selling
ordinary kamote fries, we thought that our product should be unique. Kamote Streepse is made
with mashed sweet potatoes with quickmelt cheese coated with breadcrumbs and deep-fried
with vegetable oil. It is crispy outside and soft and flavorful inside. Although it is fried, we
made sure that the oil that we will be using in frying is still healthy for the consumers. Kamote
Streepse is paired with Pink Juice made from boiled kamote tops leaves that is very rich in
iron and increases hemoglobin count with lemon extract that contain a high amount of vitamin
C and soluble fiber. Kamote Streepse is not the usual sweet potato that others are selling; we
made it look more attractive, new and has a twist that can caught the attention of the buyers.
Sweet Potatoes or Kamote in Filipino are one of the most produced crops here in the
Philippines and it has a cheap selling price in the local markets. When you go to any local
markets, sweet potatoes are anywhere. Kamote is known to be cheap but excellent source of
carbohydrates, vitamin A, carotene, calcium, fiber, iron, and phosphorus. By this crop, we can
attain our goal which is to provide a healthy, affordable and delicious snack.
Our intention of starting our business by providing healthy, affordable and delicious
snacks in Davao City is to test run the business for a period of 2 to 4 years to know if we will
invest more money and expand the business. To further discuss, identify the advantages and
dis-advantages of our product and to position our business to maximize our strength, leverage
on the opportunities that will be available to us, mitigate our risks and be welled equipped to
confront our threats we will use SWOT analysis.
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2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

-The strengths of our business is that we offer

new product in the market. So far, there is no
existing company/business other than us that
offers the same product as ours.

- Our product is healthier compare to other

snacks offered in the market since sweet
potatoes contains more vitamins and minerals.

- Since one of our target markets are

students, the price of our product is very
much affordable and convenient to buy since
Strengths we are using the double-decker cup.

-- A major weakness that may count against us

is the fact that we are a new company –
business, we don’t have yet the financial
capacity to compete with our competitors
who are already determining the direction
of the market.

- Sweet potatoes are noconsidered to be

Weaknesses appetizing to some.

-The fact that we are going to be operating our

business outside the main gate of The
University of Mindanao, Matina Campus which
has 41,500 students excluding staffs and
faculty, provides us with more opportunities to
Opportunities sell our products.

- Just like any other business, one of the

major threats that we are likely going to
face is economic downturn. It is a fact
that economic downturn affects
purchasing / spending power.

- Another threat that may likely confront us

is the arrival of a new product that are related
to what we are offering in same location where
ours is located.
Threats
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2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Customer Benefits
- Satisfaction. It will give them satisfaction since the product is healthier and
flavorful than other snacks offered in the market.
- Convenience. It is convenient to buy because it is packed using the double decker
packaging, which you can put the juice and the kamote streepse in one piece.
- Health Benefits. Sweet potatoes contains various nutrients and minerals.

Process in making the Kamote Streepse

1. Peel sweet potatoes and place it in a steamer for about 30 mins until soft

2. Transfer to a large bowl and mash the steamed sweet potatoes.

3. Transfer the mashed sweet potatoes to the cooking pot w/ low fire and add
quickmelt cheese, water, salt and pepper then mix.
4. Transfer the mashed sweet potatoes with cheese in the tray with parchment
paper/wax paper then flatten it.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

5. Let it cool down.

6. Put the flattened mashed sweet potatoes with cheese in the freezer for about 1-2
hours.

7. After 2 hours, cut the flattened mashed sweet potatoes with cheese into strips to
make it kamote streepse.

8. Coat the kamote streepse with egg, flour and breadcrumbs.

9. Deep fry the kamote streepse until golden brown.

10.
11.
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2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

10. When kamote streepse are already golden brown, strain it and put it in a plate with
a tissue to remove excess oil.

Process in making the Pink Juice (Kamote Tops Juice)

1. Wash and clean the kamote tops leaves in running water.

2. Pluck leaves, choose more purple leaves and remove stems.

3. In a shallow pot, pour in water and add in kamote tops leaves.

 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

4. Bring it to a boil and let it simmer for about 10-15 minutes. Turn off heat, remove the
leaves and use a strainer.

5. Transfer juice in a pitcher or a glass.

6. Add the calamansi juice and sugar then stir. The juice will turn pinkish after you add in
the calamansi.

Final Product: Kamote Streepse w/ Pink Juice combo

The final product contains 8 kamote streepse and cold pink juice per cup for 50 pesos.
Aside from being affordable and healthy, this is also very convenient because we put the
kamote streepse and pink juice in one.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

III. Target Market

Overview of the Market: Demand and Supply

Sweet potatoes can be processed into different food products with higher economic value
than fresh roots. According to the Department of Agriculture, because of its many uses, the
demand for sweet potatoes has significantly increased. There are many snacks that can be made
from sweet potatoes like the very known camote cue, kamote chips, kamote turon, kamote fries
and so on and so forth. Since our product is a finger food, we should also look for the demand of
finger foods. According to a website – Frozenfood, The demand for finger foods is benefiting from
prevailing trends in both the retail and foodservice businesses. Many retailers invest in selling
finger foods because it does not require a lot of capital and since food never get out of trend, you
can really gain profit by selling it. Finger foods are in high-demand because of its convenience.
People are mostly busy, so they prefer to eat something that is made simple and easy. People are
more into healthy snacks nowadays, According to The Worldwide Healthy Snacks Market. People
are becoming health-conscious rather than just to satisfy themselves by eating not-so-healthy
snacks. By gathering these informations together, we made a product that will surely satisfy our
customers’ health, budget and taste buds.
The majority of our target market will be coming from the students of The University of
Mindanao. Currently, there are 41,500 students enrolled in this institution. The percentage
demand of our product to the students of UM is 50%. Therefore, out of 41,500 students, half
of them which is 20,750 shows high demand to our product. Supply

When you go to your near local market, sweet potatoes are always present together
with the kamote tops leaves. According to [Link], the production volume of sweet
potatoes in the Philippines is approximately 525.6 thousand metric tons. The production value
of sweet potatoes in the country was almost nine billion pesos.

Market Evaluation: Market trends

Snacks and go-to foods are never out of trend. According to the Specialty Food
Association’s annual State of the Specialty Food Industry research, 2019-2020 edition, everyday
snacking appeals to close to half (47%) of consumers. Snack foods are growing because they
encompass many overarching trends like convenience and impulsive buying. Snacking as a
business is definitely evolving. More people are replacing meals with snacks. Which means that
the types of snacks they are choosing needs to be more nutritious.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

According to Leeann Rybakov, CEO of BuckWHAT Foods, she guess that in 10 years, the
snacks that will be gravitating will be those with real food ingredients and no processed sugar.
Healthy snacking surely has nutritious core ingredients. As long as flavor/taste experience can
be maintained, it will fulfill the desire for snacking adventure over the next decades. According
to Ellis Fried, CEO of SMPL, the demand for snacking will grow as people are increasingly
busy and on the go. Our product is an example of a finger food. Today, finger food has
become a craze and trend that people are excited about. Finger food is eaten by hand.
Ideally, you will not need a fork, or knife to eat it. The attraction of these foods is that you just
pick them with your fingers & most can also be consumed in a single bite. According to an
article of Didier Sockell – Food For Thought: What spiked the finger food trend? Regardless of
the type of finger food served, finger foods are preferred because it’s a no-mess food, it looks
interesting, simple to serve, convenient, can be very healthy and cost-effective.

IV. Competitors
The Kamote Nation’s competitors are based on its location. The following are
the considered main competitors of the Kamote Nation: Name: Santino’s Pizza

Competitive Product: Pizza

Location: Outside the main gate of UM Matina Campus
Target Markets: Students of the University of Mindanao

Strengths Weaknesses
Business - Santino’s Supreme Business - Nowadays, there are a
Pizza is a recognized lot of competitors that
brand or trademark offers much better
- 8 years in the Food varieties of products.
Industry.
- The Philippine's
Largest Pizza Cart
Brand with over 200
outlets
Product - They only have 4 Product - No healthy products
flavors of pizza such as low calorie
offered in the market. products.
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2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Name: Taco Boy

Competitive Product: Fried tacos and other Mexican food
Location: Outside the main gate of UM Matina Campus
Target Markets: students, staffs and faculties of The University of Mindanao
Strengths Weaknesses
Business - 15 years in the Food Business -
Industry.
- A very known Food
Snack Business,
specially here in
Davao City
Product - Offers product that Product - Most people do not
incorporates the bother to try their
classic mexican other products such
favorite with a filipino as soft taco, nachos
twist. and other Mexican
- Their famous fried snacks that they are
tacos is delicious and offering.
budget friendly.
- The generous
amount of fillings in
their fried taco, is one
of the factor that
made their business
profitable.

Name: Waffle Time

Product: Waffles w/ varieties of fillings
Location:
Target Markets: Students of the University of Mindanao
Strengths Weaknesses
Business - 22 years in the Food Business - There are a lot of
Industry. competitor arising
- Awarded as the Most nowadays that offers
Promising Filipino more quality and
Franchise. varieties of products.
- Example of this is The
Belgian Waffles.
Product - Sells affordable, Product - Waffles contains a lot
delicious and high- of carbohydrates that
quality waffles. may increase a
person’s blood sugar
level
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

V. Marketing Strategies / Realization of the Proposed Business

Market Segmentation

Kamote Nation’s customer base in Davao City is comprised of five target groups.

1. Students of The University of Mindanao

2. Staffs and Faculties of The University of Mindanao

3. Local residents of our location

4. Health-conscious and Snack lovers

5. Other customers (Pass byers)

These groups are all potentially strong customer segments. The benefit of this mix of
customers is that it helps maintain consistent business throughout the year. For example,
while classes is on-going, students, staffs and faculty members peaks during June to March.
Conversely, the local residents peaks during March to May since it is the start of summer
vacations.

- Students of The University of Mindanao. There are approximately 41,500 students

in The University of Mindanao, Matina Campus. Majority of the students use the main
gate which is located in Matina, where our kiosk is located. Therefore, a lot of students
will pass by our kiosk and many will be informed about our product.
- Staffs and Faculties of The University of Mindanao. Since The University of
Mindanao caters a lot of students, it is obvious that they also have a lot of staffs and
faculty members. Just like the students, many of the staffs and faculty members also
uses the Matina gate upon entering and leaving the campus.
- Local residents. University of Mindanao Matina Campus is located near-by
residential areas. Therefore, whether the classes is on-going or not there will still be
available target markets for us.

- Health-Conscious and Snack Lovers. Sweet potatoes are often touted as being
healthier than white potatoes it provides more potassium, fiber and are incredibly high
in vitamin A. They do not have to worry about their health while eating snacks
because we offer a delicious, healthy and affordable snack.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

- Other Customers. There are a lot of people enters the UM Matina Campus because
of different concerns. Therefore, there will be many other potential customers that will
pass-by our kiosk.

Promotions Strategy
Social Media
Since students nowadays mostly have their own social media accounts, more
specifically Facebook, Instagram, and Twitter. Social media plays a great impact
on everyone’s lives. Kamote Nation wants to keep in touch not just through its
physical store but also online with its target market. We will use social media to
communicate and reach our desired target market. Kamote Nation also provide
an informative page for the customers to become more knowledge able with the
products that we well, and also to our company.
▪
Our Facebook Fan Page is Kamote Nation PH

o Through this facebook fan page, people can see the background
informations about the company. Kamote Nation created this page
because based on our research, most Filipinos has their own facebook
account, specially students and teenagers. In relation with that, they can
easily leave a feedback based on our products, services and how
accommodating the staffs of Kamote Nation.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Kamote Nation has a twitter account where customers can freely express
their reactions and comments towards our product. With the help of this site,
we can easily monitor their assessments by using a hashtag
#KamoteNationPh. By searching our official username @KamoteNationPh
customers can easily tweet or send direct messages to us.

▪
Instagram
o Searching the username @KamoteNationPh, you can easily allocate our
instagram account. As of March 1, 2020, our Instagram account has 294
followers and counting. Instagram enables the customer to see the latest
picture of our product. Our company uses this networking site so that
customers can be updated with the promos and the new products that we
might add later on.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131
College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Season’s Promo
In every business, big or small, it is important to have a season’s promo. Having a
relatable themes helps attract customers. Turning this into a promotion will add more value.
Currently, Kamote Nation has 4 seasonal promos (Christmas Season Promo, Valentine’s Day
Promo, It’s your birthday promo, and UM Day).
Opening Grand Launch Plan
For the grand opening of Kamote Nation, we will establish a promo that during
opening, first 20 customers that will purchase 3 of our products will get 1 for free. Product
Range
Since our location is outside the main gate of the University of Mindanao, Matina
Campus, we are expecting that we can accommodate mostly the students of University of
Mindanao and some of the faculties and staffs. Besides, Kamote Nation sells healthy,
affordable and to-go products. It is very convenient because it is packed using the double
decker packaging, which you can put the juice and the camote streepse in one piece.

Product Details
Our major product is Kamote Streepse, it is made of Camote or Sweet Potatoes and
other ingredients. The product is highly nutritious because Sweet Potato are great source of
fiber, vitamins, and minerals. It may enhance your brain function, a clearer vision and may
support your immune system. Characteristics that every customer, particularly students must
bear. Along with the Kamote Streepse, we also provide a juice called “Pink Juice”, basically it
is a pink juice made by boiling the leaves of sweet potato (broth) and extracting lemon juice.
Together, both products are great snacks for having a healthy diet. Pricing Strategy

Kamote Nation sets up the price through Mark-Up Pricing. It is a common type of
pricing basically in retailing which a retailer sells the product to earn and maximize profit. 78%
percentage Kamote Nation’s added from the normal product’s price in order to gain profit.
Distribution Strategy
Distribution Strategy is an important aspect in marketing strategy because it is the
process of how the company deploys its products from the production location to the
customers/consumers. Kamote Nation is a retailer because our company sells directly to the
consumers. We wanted to preserve the freshness and the nutrients of Kamote Streepse
Module for GE 11: Entrepreneurial Mind Page | 80
FOR INSTRUCTIONAL USE ONLY. NOT for QUOTATION. NOT for REPRODUCTION
Prepared by: Reil S. Romero and Adriane John P. Luncido Reviewed by: CBAE
College Monitoring Committee
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131
College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

VI. Location/ Production

The location of Kamote Nation kiosk is located outside the main gate of the University
of Mindanao, Matina Campus. This is an excellent location to serve our target market since it
is close to the entrance and exit of the school. One dis-advantage of the location is that only
limited people can see our kiosk since the location is not that easy to locate for those people
who does not reside or go to The University of Mindanao. The business will operate from
Monday to Saturday, hours of operation will be 10:00 am – 6:00 pm only.
The production is in-housed production. The members are all responsible for the
preparation of the product and other concerns of our business. The production will take place
in one of the member’s house that is located at Sandawa, Davao City which is also near in the
location of our kiosk.

Kamote
Nation

Production
will take place

Figure 1. Location of the Kamote Nation’s kiosk and where production will take place.
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

VII. Management

Position Information
Position: General Manager
Kyla Sanchez will enforce and uphold the company’s credit policy. Authorized to
perform the overall strategies of the company, implementing the company’s goal, controlling
the work force, examines the budget and ensuring that all the resources are in good condition
and has a back-up plan in case of emergency to achieve the goal of the company. Salary: P
9,600
Position: Marketing Manager
Jemelle Supan will provide the planning and leadership to the Marketing Department by
ensuring that the appropriate structures, systems, competencies and values are developed in
order to meet and exceed the goals of the Marketing plan. The Marketing Manager is also the one
who is responsible for managing marketing, advertising and promotional staff and activities
at the company.

Salary: P 9,600
Position: Finance Manager
Jorien Falconite is responsible for all areas relating to accounting functions and
financial reporting. This position will be responsible for daily, weekly and monthly accounting
tasks and activities.
Salary: P 9,600
Position: Production Manager
Sheila Leong is involved with planning, coordination and control of manufacturing
processes. Ensures that goods and services are produced efficiently and that the correct
amount is produced at the right cost and level of quality. Salary: P 9,600

Position: Marketing Assistant

Jihan Cabugatan supports the work of Ms. Sheila Leong and executives on projects
directed at maximizing company profits and developing sales strategies or marketing
campaigns.
Salary: P 9,600
Position: Product Development Assistant
Criselle Libres designs and/or develops new products. Evaluates and searches for
improvements to existing products offered is also part of her job. She will also work closely
with our marketing department to create products based on the consumers demands. Salary:
P 9,600
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Position: Accountant
Twinkle Naong will prepare and examine financial records to make sure that these
records are accurate, provides financial information to our management by researching and
analyzing accounting data.
Salary: P 9,600

VIII. Cost of Production and Pricing Strategies

The Kamote Nation’s projected output per day is 200 cups. Therefore, there will be an
output per month of 4,800 cups. Listed below are the variable costs and inputs that took place
in the production to attain the projected output per month.
Table 1. Variable Costs
Variable Inputs Unit Quantity Unit Price Cost per
month
Sweet potatoes Kg 96 20 ₱1,920
Camote leaves Bundle 360 5 ₱1800
Cheese bar or 96 48 ₱4,608
440g
Breadcrumbs 1 pack or 192 29.50 ₱5,664
230 g
All-Purpose Flour Kg 24 45 ₱1,080
Egg Pcs 576 5 ₱2880
Brown sugar Kg 24 36 ₱864
Calamansi Kg 24 20 ₱480
Double-decker 1 pack = 144 60 ₱8,640
cup 36 cups
Straw 1 Pack = 36 50 ₱1800
100 pcs
Transportation 500 ₱500
Light & Water -Kilowatts ₱1,500
-Cubic
meters
Gas 1 350 for 3 ₱116
months
Ice Pack 48 30 ₱1,440
Cellophane Pack 1 30 ₱30
(supplies)
Vegetable oil 1 Gallon 3 400 P1,200
Total Variable ₱34,522
Cost per month:
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2nd Floor, SS Building
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Telefax: (082)227-5456 Local 131

Listed below are the Fixed Inputs and total fixed costs per month:
Table 2. Fixed Costs
Fixed Inputs Total fixed cost per month
PPE (Schedule 1) ₱226
Rent (location) ₱5,000
Rent (production) ₱2,500
Labor P67,200
Business permit P251
Total Fixed Cost: ₱75,177
Schedule 1: PPE
PPE Cost Useful life (yr) Depreciation/month
Electric fryer ₱2,200 5 ₱37
Glass display ₱1,000 5 ₱17
Kiosk and signage ₱4,000 5 ₱67
Glass Jar ₱1,000 5 ₱17
Single Burner ₱600 2 ₱25
Kitchen Equipments ₱750 1 ₱63
Total: P9,550 ₱226

Total Cost per month = Total Fixed Costs per month + Total Variable Costs per month

= ₱75,177 + ₱34,522
=
Total Cost per month = ₱109,699

Average Total Cost = Total Cost / Quantity

= ₱109,699 /4,800
=

Average Total Cost = ₱22.85

To determine the price of Kamote Streepse & Pink Juice combo, we will use Mark-up
Based Pricing
ATC = P 22.85
MU= 78%
Selling Price = ATC + ATC (MU)
= ₱22.85 + ₱22.85 (0.78)
= ₱23.04 + P17.82
= ₱40.86
=
Selling Price ≈ ₱ 40.00

MU % = SP-ATC/SP x 100
= P40-P22.85/P22.05 x 100
= P17.15/P22.05 x 100

MU % = 0.7777 x 100 = 77.77% ≈78%

 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Kamote Nation will be selling Kamote Streepse w/ Pink Juice combo for 40 pesos. Our
profit per cup is 22.85 pesos, approximately 23 pesos. Our sales projection is 200 cups per day. In
a day, our target sales will be P8,000 (200x40) In a month, our target sales will be P192,000
(4800x40). In a year, we should sold cups to achieve our target sales of P2,304,000 (57600x40).
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

IX. Projected Financial Statement (1 year)

Kamote Nation
Income Statement
For The Year Ended December 31, 2020

Sales P2,304,000
Less: Cost of Goods Sold 399,312
Gross Profit 1,904,688
Less: OPEX (Schedule 1) 1,032,316
Operating Profit P872,372

Schedule 1: OPEX
Salaries Expense 806,400
Advertising Expense 11,988
Utilities Expense 18,000
Supplies Expense 5,000
Production Expense 97,920
Taxes & Licenses Expense 3,008
Rent Expense 90,000
1,032,316

Kamote Nation
Statement of Changes in Equity
For the Year Ended December 31, 2020

Kamote Nation Capital, beg P 120,000

Add: Profit 872,372
Total: 992,372
Less: Withdrawals 100,000
Kamote Nation Capital, end 892,372
 College of Business Administration Education
2nd Floor, SS Building
Bolton Street, Davao City
Telefax: (082)227-5456 Local 131

Kamote Nation
Balance Sheet
As of December 31, 2020

Assets
Cash 840,204
Prepaid Rent 45,000
PPE 9,550
Less: Accumulated Depreciation 2,712 7,168
Total Assets 892,372

Liabilities
Accounts Payable 0
Total Liabilities 0

Owner's Equity
Retained Earnings 892,372

Total Liabilities and Owner's Equity 892,372