HINATUAN SOUTHERN COLLEGE

Business Administration Program

Hinatuan Surigao del Sur

HEAVEN’S DELIGHT

A Proposed Feasibility Study Presented to

The Faculty of the Business Administration Program
Hinatuan Southern College
Hinatuan, Surigao del Sur

In Partial Fulfillment of the Requirements for the

Degree of Bachelor of Science in Business Administration
Major in Financial Management

By

JERICO B. PLANGANAN B.
MONTERO, JOHNDY P.
CAÑAL, MICHELLE
FEBRA, NICKA N.
LIMBANGANON, MAYETH C.

November, 2021
 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

APPROVAL SHEET
This Feasibility Study is entitled Heaven’s Delight prepared
and submitted by in partial fulfillment of the
requirements for the degree, Bachelor of Science in Business
Administration Major in Financial Management, has been
examined and recommended for Oral Examination.

_____________________
Adviser

Approved in partial fulfillment of the requirements for the

degree, Bachelor of Science in Business Administration Major
in Financial Management, by the Oral Examination Committee
on Date of Oral Defense with a grade of Passed.

MS. MARIA LOURDES T. ESCALERA

Chairperson

MR. VANRIEL G. CABO, LPT MRS. JELLY C. DALMAN

Member Member

MR. KENT JOY A. FRANCISCO, LPT

Member

Accepted in partial fulfilment of the requirements for the

degree of Bachelor of Science and Business Administration
Major in Financial Management.

ENGR. JUANITO A. BALBUTIN, Ed. D, Ph. D

College President

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Business Administration Program
Hinatuan, Surigao del Sur

ABSTRACT

Cake is a form of sweet dessert that is typically baked. In

its oldest forms, cakes were modifications of breads, but

cakes now cover a wide range of preparations that can be

simple or elaborate, and share features with other desserts

such as pastries, meringues, custards, and pies. Cake is

often served as a celebratory dish on ceremonial occasions,

such as weddings, anniversaries, and birthdays. The purpose

of this study is to propose a business that will produce a

high quality and delicious pastry in Hinatuan. This

feasibility study was conducted to 100 customers within

Hinatuan, Surigao del Sur. 1. The business has acquired

capital of P 1,000,000 and the partners has equal investment

of P 200,000. Heaven’s Delight budgeted sales for the first

year are 3,600 units and increased to 5% in every year. All

expenses and taxes will be paid every year and market share

increased annually by 4%.

Keywords: Cake, Pastry, Business, Market Share, Budget

Sales, Heaven’s Delight

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Business Administration Program
Hinatuan, Surigao del Sur

ACKNOWLEDGEMENT

We would like to thank and express our sincerest and

heartfelt gratitude for those who showed support and

dedication in the accomplishment of this feasibility study.

First, to our adviser , we are so lucky and

grateful that you are always there to give your untiring

guidance so that we can improve our study. Once again, thank

you for your generous time and effort.

Second, to our proponents themselves who have given a

lot of efforts and consumed so much time to make the

completion of Feasibility Study be possible and successful

with the given time.

Lastly, to our friends, acquaintances, parents who have

patience and sincerely support our financial needs, and the

teachers who have made valuable encouragement and support to

finish this challenge, we are very grateful and forever

indebted.

Above all, thank you to our almighty God for bestowing

us strength at all times. We are always grateful for the

constant providence and protection in the whole conduct of

this research study.

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

DEDICATION

This study is wholeheartedly dedicated to our beloved

parents, who have been our source of inspiration and gave us

strength when we thought of giving up, who continually

provide their moral, spiritual, emotional, and financial

support.

To our brothers, sisters, relatives, mentor, friends,

classmates, and anybody who shared their words of advice and

encouragement to finish this study.

And lastly, we dedicated this dissertation work to the

Almighty God, thank you for the guidance, strength, power of

mind, protection and skills and for for giving us a healthy

life. All of these, we offer You.

-The Researchers

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

TABLE OF CONTENTS

TITLE PAGE…………………………………………………………………………………………………………………………….
APPROVAL SHEET……………………………………………………………………………………………………………………
ABSTRACT……………………………………………………………………………………………………………………………………
ACKNOWLEDGEMENT…………………………………………………………………………………………………………………
DEDICATION………………………………………………………………………………………………………………………………
TABLE OF CONTENTS……………………………………………………………………………………………………………
LIST OF TABLES…………………………………………………………………………………………………………………
LIST OF FIGURES………………………………………………………………………………………………………………
CHAPTER 1 BACKGROUND OF THE STUDY………………………………………………….………
1.1 Introduction………………………..………………………………………………………
1.2 Business Name……………….………………………………………………………………
1.3 Scope and Limitation.……………………………………………………………

CHAPTER 2 MARKET FEASIBILITY……………………….………………………………………………

2.1 Target Market and Completion…………………………………………
2.2 Market Size and Geographic Area…………………………..…
2.3 Market Share…………..……………………………………………………………………
2.4 Competition……………………..……………………………………………………………
2.5 Marketing Strategy……………………………………………………………………
2.6 Promotion…………………………………..……………………………………………………
2.7 Distribution Strategy……………………………………………………………

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

CHAPTER I

BACKGROUND OF THE STUDY

Introduction

Cake is a baked batter consisting of flour, sugar,

salt, baking materials, shortening, milk, eggs, and

flavorings. Cake is a high-protein, high-carbohydrate, high-

fat, high-calcium, and high-phosphorus food. Vitamin A,

vitamin B1, and vitamin C are also included in cake. Cake is

a delicious baked product produced from a dough or thick

batter that commonly includes flour, sugar, eggs, and a

rising agent like baking powder. Cakes as a part of bakery

product have different characteristic compared to another

bakery product. Based on the definition, cake is included in

baked confectionery products, it means that cake is a sweet

food product which contains more sugar and made from four

main ingredients, those are flour, sugar, eggs and butter.

Cakes have wide classification, since it can be seen from

various viewpoints such as based on batter cake and the way

of cooking. Based on batter, cakes are classified into three

types. They are pound cake, sponge cake and chiffon cake.

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Business Administration Program
Hinatuan, Surigao del Sur

Based on way of cooking, they are baked and steamed cakes.

(Subagjo,2007).

In Indonesia, cakes are classified as "kue basah"

(moist cake) or "kue cookies" (cookies) based on their water

content. Moist cake has a soft texture and is perishable due

to the composition or elements of moist cake, which are

easily stale, such as flour, sugar, coconut milk or water,

egg, and salt. Cookies are usually textured bit harder, and

more durable in comparison with the moist cake. Moreover,

the way of cooking is also different, Moist cake usually

cooked by steaming and baking while Pastries cookies by

baking (Syarbini, 2014).

A study of Caramonte (2012) was conducted in the four

municipality in the Eastern part of Laguna during summer of

2016. It aimed to seek an optimistic opportunity on creating

a unique cake product that could meet interest of the people

who are looking for a new variety of taste for cakes made of

fruit. Supply for cakes are only limited in the eastern part

of Laguna. There are four cake producers that has a maximum

capacity production of 21, 796 cakes per year. It also shows

that cake manufacturers only produce cake without cream

filling. Innovation of cake products is widespread and it is

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Business Administration Program
Hinatuan, Surigao del Sur

necessary to improved its taste for human consumption and

satisfaction.

Filipino enjoy eating cakes during festivities, cake is

considered a part of life. Family gatherings aren't always

complete without cake to make them particularly special.

Innovations help to develop and improve cake products. Cake

flavors and fillings have evolved as the demand for cakes

has grown. The food preferences and taste of the people are

also changing it is why it is timely to innovate the

products for its human consumptions. The food preferences

and taste of the Hinatuanons are also changing it is why it

is timely to innovate and to propose a product for its human

consumptions (Subagjo, 2017).

Business Name

The proposed business will be named “Heaven’s Delight”

the makers of heavenly delightful cakes for all occasion. It

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Hinatuan, Surigao del Sur

also offers customized mini cake for your small sweet

cravings. We will be located at Purok La Casa, Hinatuan,

Surigao del Sur. The business will make sure to meet the

customers’ satisfaction and a hundred percent pastry quality

will be served to them.

Scope and Limitation

This study aims to establish a pastry shop in Hinatuan.

This will be based on marketing, technical management,

financial and socio-economic aspect of the proposed

business. This study is intended to cover only the

Municipality of Hinatuan. It is not possible to propose a

business on whole of the business market of Hinatuan and

thus the findings of the study depend upon the availability

of data with reference to time and accessibility.

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Business Administration Program
Hinatuan, Surigao del Sur

CHAPTER II

MARKET FEASIBILITY

Target Market and Competition

The primary target of the proposed pastry shop will be

the customers’ who has a big or small celebration and café

within the locality of Hinatuan. Café included Pan de Pane,

Jashy’s Bread and Pastries, Avisha Bistro and KTV and Karl

en Jay. Since the business will be having its own physical

and online shop, it easy for them to set their orders and

deliver.

Though there are already pastry shops here around in

Municipality of Hinatuan, the business shall ensure the

product with its eye-catching and delicious taste. For us to

be able to maintain the momentum and regular customers will

keep on setting their orders as many as they can and

consider its demographic and geographic location.

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Hinatuan, Surigao del Sur

Market Size and Geographic Location

The site for the pastry shop are properly wise

selected. All the technical parameters and accessibility are

considered. Pastry shop plan to include the business plan

and the bakery industry aspect. Food and taste management

considerations are also prepared and approved. All the

government including the business permit are complied.

Pastry shop area and design are based on the type of

operation or trend to adopt. Size, colors and shaped are

also considered.

Thus, the estimated market size of the proposed

business is at large population due to the fact that food is

essential to all consumers and it includes pastries

consumption.

CAFÉ / CUSTOMERS RESPONDENTS

Target Market 100

TOTAL 100

Table 1. Total Number of Respondents

Market Share

Based on the survey conducted, 42% from Pan de Pane, 8%

Jashy’s Bread and Pastries and 20% from Avisha Bistro and

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Hinatuan, Surigao del Sur

KTV, 14% from Carl en Jay and 16% from Heaven’s delight of

the total number of respondents do consume cakes and are

willing to do business with HEAVEN’S DELIGHT.

MARKET SHARE VS. COMPETITOR

2%

Pan de Pane 16 %
Jashy's Bread and Pas-
tries 42 %
14%
Avisha Bistro and KTV
98%
Carl En' Jay 20%
8%
Heaven's Delight

Willing Not Willing

Figure 1. Market Share VS. Competitor Share

Competition

Since the pastry shop has already known in the

municipal even small businesses are still operating its own

pastry shop. Exceptional customer service and commitment:

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Hinatuan, Surigao del Sur

The owners of Heaven’s Delight Pastry Shop pride themselves

to being on location everyday and getting to know the

majority of their clientele. Employees love interacting with

the clients and listening to what the client really

envisions for their custom made cake. It is extremely

rewarding to put that idea into reality and deliver what the

client envisioned.

Marketing Strategy

Marketing strategies for pastry shop may be easier

because the product is already known to the consumers. We

can now use the social media as one of the marketing

strategies since this is one of the ways to gain more

customers by making them attracted by our picture shots and

selling strategy. We will encourage those senior citizens to

present their identification card and for those who are

fully vaccinated they may present their vaccination card for

them to avail our 10% discount from the total price. Thus,

the proponents still ensure building a good relationship to

target retailers and consumers.

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Hinatuan, Surigao del Sur

Promotion

One of the oldest methods for pastry shop to promote

their goods and services is to provide discounts.

Discounting can be done in a variety of ways, depending on

your business goals. We could run a weekly deal where

consumers may buy one baked treat and get one free, or we

could give elderly, college students, parents, service

employees, or children a percentage discount on particular

days. In this time of pandemic, we will use the social media

such as facebook and instagram to promote our shop with our

yummy and sweet cakes for our beloved customers.

Distribution Strategy

Most cafés now sell coffee and packaged pastries but

many of the baked goods could use an upgrade. That’s where

our bakery comes in. Partnering with local café stores is a

mutually beneficial relationship. We can get more exposure

and shelf space, while they get a portion of the revenue and

a new source of food traffic. We will also deliver their

order/s with minimal fee depending on its location and they

may pick-up or visit directly the shop to buy our products

from our shop.

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Business Administration Program
Hinatuan, Surigao del Sur

CHAPTER III

TECHNICAL FEASIBILITY

Business Space and Location

The business location is at Prk. 2 Barangay Aquino,

Hinatuan, Surigao del Sur located beside at Public Market.

The proposed business is convenient and accessible for the

target market and costumers.

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Hinatuan, Surigao del Sur

Commercial Space for Rent

The space will undergo renovation, rehabilitation of

the space and construction of the building, light and water

works, equipment or other furniture and fixture just to

maximize the space intended for the business. This is to be

done to encourage employees’ interaction and provide them

with a brand-new slate to work on their creativity, and will

eventually provide your business with new ideas to gain

costumers. The area has (21 sqm.), a 2 months deposit and

advance total of P9,000.00 and cost of P4,500.00 pesos on a

monthly basis onward provided by a lease contract for

minimum of 1 year and renewable.

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Hinatuan, Surigao del Sur

Operating Procedure

Cake is a baked sweet food made from flour, sugar, and

other ingredients. Cakes originated as bread modifications,

but they today encompass a wide range of simple to intricate

preparations that share characteristics with other sweets

such as pastries, meringues, custards, and pies. After we’ve

decided what type of bakery we want to open and what sort of

products we want to make, HEAVEN’S DELIGHT pastry shop

offers at the same time cashless and deliveries for a less

hassle transactions and also to produce high quality cakes

for our beloved customers. Each baking process has its

strengths and the employees will look upon these before

going on the process.

Receiving Order Design

 Receiving order  The baker will ask

confirmation from the for a chosen design 18
Client from the customer.
 Note the time of  The baker will start
order received to create the cake to
 HINATUAN SOUTHERN COLLEGE
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Hinatuan, Surigao del Sur

Distribution Tagging
 The employee/s will now  The employee will count
distribute the order/s to the order/s from the
their customers. customer/s.
 Then take a picture of
the finished product then
send it to the customer
Operational Equipment andfor a confirmation.
Supplies

EQUIPMENTS:

FUNCTION: They use to create

a cake and meringue.
PRICE:P345.00
EXPIRATION: 3-5 years

CAKE DECORATING SUPPLIES

FUNCTION:  use to squeezed by
hand to pipe semi-solid
foods by pressing them through
a narrow opening at one end
often fitted with a shaped
nozzle, for many purposes.
PRICE: P72.00

DISPOSABLE PIPING BAG

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Hinatuan, Surigao del Sur

FUNCTION: used by placing an

undecorated cake onto its
rotating surface.
PRICE: P99.00
EXPIRATION: 3-5 years

CAKE TURNTABLE

FUNCTION: used for making

small cakes and other
pastries and are an
excellent way to make
several uniform desserts at
one time.
PRICE: P175.00
EXPIRATION: 3-5 years
CAKE MOLDER

FUNCTION: Use to bake a

cake and other pastries
PRICE:P35,000.00
EXPIRATION: 5-10 years

GAS RANGE WITH OVEN

FUNCTION:  It is primarily
used as cooking fuel.
PRICE: P1,000.00
EXPIRATION: 1-2 years

GAS TANK

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Hinatuan, Surigao del Sur

FUNCTION: help automate the

repetitive tasks of
stirring, whisking or
beating.
PRICE: P2,000.00
EXPIRATION: 3-5 years

CAKE MIXER
FUNCTION: to measure the
volume of liquid or bulk
solid cooking ingredients
such as flour and sugar.
PRICE: P129.00
EXPIRATION: 5-10 years

MEASURING CUPS

FUNCTION: Use to mix all

the ingredients.
PRICE:P20.00
EXPIRATION: 5-10 years

WHISK
FUNCTION: Used to sift dry
ingredients.
PRICE: P50.00
LIFE SPAN:3 YEARS

SIFTER

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Hinatuan, Surigao del Sur

FUNCTION: use to display the

cake/s.
PRICE: P12,000.00
EXPIRATION: 1-5 years

GLASS STAND
FUNCTION: use to weigh some
equipment or supplies for
cake.
PRICE: P729.00
EXPIRATION: 1-5 years

WEIGHING SCALE
FUNCTION: Used to display
cakes.
PRICE: P19,300.00
LIFE SPAN: 10-15 years

CHILLER/COOLER

FUNCTION: use to pack the

cake/s ordered by the
customers
PRICE: P280.00 for 10 pcs.
EXPIRATION:

BOX FOR PACKAGING

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Hinatuan, Surigao del Sur

FUNCTION: Used as delivery

service.
PRICE: P155,000.00
LIFE SPAN:15 years

DELIVERY FOR SERVICE

FUNCTION: Serve as an
organizer and counter table
for cashier/manager.
PRICE: P3,000.00
LIFE SPAN: 5 years

WOODEN TABLE

FUNCTION: Used as seating

for making use of table.
PRICE: P1,000.00
LIFE SPAN:5 years

WOODEN CHAIR

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FUNCTION: Used to store

supplies.
PRICE: P21,998.00
LIFE SPAN:10 years

REFRIGERATOR

SUPPLIES:

FUNCTION: used in
thickening gravies and
sauces.
PRICE: P95.00
EXPIRATION: 1-2 years

ALL PURPOSE FLOUR

FUNCTION: to sweetened
the cake.
PRICE: P59.00
EXPIRATION:1-2 years

WHITE SUGAR

FUNCTION: allows baked

goods to rise and become
light and fluffy.
PRICE:P140.00
EXPIRATION: 1-2 years

BAKING SODA

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Hinatuan, Surigao del Sur

FUNCTION: used to increase

the volume and lighten the
texture.
PRICE: P140.00
EXPIRATION: 1-2 years

BAKING POWDER

FUNCTION: imparts a full

rich chocolate flavor and
dark color.
PRICE: P175.00
EXPIRATION: 1-2 years

COCOA POWDER
FUNCTION: to add flavor
to a cake.
PRICE: P98.00
EXPIRATION: 1-2 years

NESCAFE STICK
FUNCTION: used alongside
baking soda as a
leavening agent.
PRICE:P100.00
EXPIRATION: 1-2 years

VINEGAR

FUNCTION: help thicken and

emulsify sauces and
custards.
PRICE: P195.00
EXPIRATION: 1-2 years
EGGS

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Hinatuan, Surigao del Sur

FUNCTION: use it as a
substitute for cream to
help reduce fat content.
PRICE: P25.00 per can
EXPIRATION: 1-2 years

EVAPORATED MILK

FUNCTION: use is for making

a whipped topping for
cakes.
PRICE: P320.00
EXPIRATION:1-2 years

WHIP CREAM
FUNCTION: Used to support
cakes to improve
presentation and make
transportation easier.
DIMENSION: 10 inches
diameter
PRICE: P18.00

CAKE BOARD
FUNCTION: modifies flavor
and increases crust colour.
PRICE:P50.00
EXPIRATION: 1-2 years

SALT

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Hinatuan, Surigao del Sur

FUNCTION: used flavor in foods

and baked goods.
PRICE: P130.00
EXPIRATION:1-2 years

VANILLA SYRUP
FUNCTION: offers a
consistent color tone
without changing the flavor
or texture of the cake.
PRICE: P189.00 per set
EXPIRATION: 1-2 years

FOOD COLORING

Cost of Production

HEAVEN’S DELIGHT

Service Costing Customize Cake

Displayed Design Cake

Direct Materials P115.75

Direct Labor 43.75
Overhead 63
TOTAL P222.50
Mark-up (50%) 127.50
Service Price P350.00

Technical Assumption

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There will 4 employees or staffs assigned in our shop,

1 will be at the kitchen as baker, 1 for checking or

entertaining the order/s, 1 for delivery and 1 for the

manager/cashier. We assume to create more than 5 designs of

cake in a week since we consider the situation and demand of

the product. But we can assure that the quality of service

and product will still remain in the eyes of our customers.

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Business Administration Program
Hinatuan, Surigao del Sur

CHAPTER IV

MANAGEMENT FEASIBILITY

Introduction

This chapter provides information about the management

aspect of the business. Basically, it shows the form of

ownership which the business has. This includes how the

business manage, the control and supervision matter and even

the start-up cost of the business. It will also provide you

with information about the basic requirements and procedures

in registering the business and the government agencies that

the business is related to.

The management aspect will determine the successful

realization of the business. That’s why the study of the

officers, key personnel and manpower requirements will be

very important matter in this chapter. Business culture

which includes the operating schedule and the day to day

monitoring will also be part of this chapter.

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Form of Ownership

The form of ownership will be partnership and each of

the 5(five) members will contribute the same amount for the

proposed business. The laws on Partnership profit and loss

distribution, article 1799 of New Civil Code provides that

any stipulation that excludes one or more partners from any

share in the profits or losses is void. The reason for this

is that partnership must exist for the common benefit and

interest of the partners. The legal requirements are

involved in which simply registering a business name and

obtaining any relevant licenses or permits from the

authority that relate to the specific type of business.

I. Registration

Essentially, a partnership business legally comes

into existence when the business owner registers the

business name and obtains any relevant business licenses.

Government Agencies for Registration

 Local Government Units where your business is

located:
a) Barangay Clearance

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b) Mayor’s Permit or Business Permit

 Bureau of Internal Revenue

 Legally Required Registration of Employee

Benefit

Employers are legally required to provide certain

benefits for the employees. Employee benefits play an

important role in lives of employees as well as their

families. For that reason, the benefits you offer can be a

deciding factor for a potential employee’s decision to work

at your business.

Employee’s Registration to the following:

a) SSS (Social Security System

b) Phil. Health

c) Pag-ibig / HDMF

II. Registering Partnership Business at SEC

 Secure Business Name with the Securities and Exchange

Commission (ESC)

 Open Corporate Bank Account

 Register with the Securities and Exchange Commission

(SEC).

 Name Reservation and Payment Form

 Notarized Articles of Incorporation and by-Laws

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 Treasure’s Affidavit

 Bank Certificate of Deposit or Proof of Inward

Remittance

 Daily Accomplish Sec. Form F-100

 Register with the Bureau of Internal Revenue (BIR)

 Register a TIN

 Register with the Social Security System (SSS)

 Employer Registration Form (R-1)

 Employment Report Form (R-1A)

 SEC Registration, Articles of Incorporation, and By-

laws

 Register with Phil. Health

 Employer Data Record (ER1)

 Report of Employee-Members (ER2)

 SEC Registration, Articles of Incorporation, and By-

laws.

 Register with Pag-ibig

 Obtain a Mayor’s or Business Permit

 SEC Registration, Article of Incorporation, and By-laws

 Locational Clearance

 Lease Contract

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 Barangay Clearance

 Go to the nearest Barangay or where the Business belong

 Notarized lease Contract

 Locational Clearance

 Locational Map

 Barangay Clearance

 Lease Contract

 SEC Registration Documents

 Occupancy Permit (Building/Unit)

 Business Permit Applicant Form

BUSINESS PERMIT AND LICENSES AMOUNT OF REGISTRATION

ESWM/Environmental 100.00
Certificate
Sanitary Permit 100.00

Health Clearance Certificate 100.00

Registration with Barangay 100.00

Mayor’s Permit 325.00

Garbage Fee 1,500.00

Sanitary Inspection Fee 100.00

Registration with SEC 1,220.00

Registration in BIR 500.00

TOTAL 4,045.00

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Table 3: Business Permit and Licenses

Business Culture

I. Operating hours from 8:00 to 5:00pm – Mondays to

Sundays.

Break time: 12:00 NN to 1:00 pm

II. Day to day monitoring

The manager/cashier will monitor the employees’

attitude and performance.

 Monitoring of sales services

 Inventory

Manpower requirements

I. Physical Requirements:

 Age must 18-30 years old

 Workers bending, crouching or walking

restriction

II. Skills, Interest and Qualities

 At least high school graduate.

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

 Knowledgeable in kitchen chores especially in

baking.

 Has ability to work methodically and follow

instructions.

 Willingness to work flexibility under pressure.

 Willingness to do repetitive work and do

overtime.

Organizational Structure

Manager/Cashier

Staff/Delivery Man Baker

Figure 4: Organizational Chart

Job Description and Duties

I. Manager/Cashier

 Responsible for the whole operation of the

business, analyzing and recording the transaction

and presenting the report on time.

II. Staff

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

 Record and settle all the order/s before the

delivery.

III. Baker

 Assigned at the kitchen in which he/she is

responsible for baking and other kitchen chores.

IV. Delivery Man

 Reviewing orders before and after delivery to

ensure that orders are complete, the charges are

correct, and the customer is satisfied. Assisting

with loading and unloading items from vehicles.

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

CHAPTER V

FINANCIAL FEASIBILITY

This chapter discusses the financial aspects of the

study, in order for the proposed business to understand that

it needs money to start.

Assumption and Market Consideration

1. The business has acquired capital of P 1,000,000 and

the partners has equal investment of P 200,000.

2. Assumed Heaven’s Delight budgeted sales for the first

year are 3,600 units and increased to 5% in every year.

3. Assume that all productions are sold out every year.

4. The purchased of supplies are paid in cash. And assumed

that all supplies used in production.

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

5. At Heaven’s Delight, unit of product requires

0.666666666 hours (40 minutes) of direct labor.

6. Assume that the business has no layoff policy, direct

labor is paid at the rate of P 62.50 per hour

regardless of the hours worked. Direct labor will be

paid every year of 2880 hours.

7. Assume all expenses and taxes will be paid every year.

8. Income tax is computed at 30%

9. The Equipment are to be depreciated in straight line

basis.

10. Market share increased annually by 4%.

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

Financial Statement Projection

PROJECTED FIVE-YEAR COMPARATIVE/INCOME STATEMENT

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

  Year 1 Year 2 Year 3 Year 4 Year 5

ASSETS          
Current Assets:          
Cash and Cash ₱ ₱ ₱
Equivalents 1,068,452.70 1,376,769.60 1,721,693.91 ₱ 2,105,056.00 ₱ 2,528,777.76
Total current ₱ ₱ ₱
assets 1,068,452.70 1,376,769.60 1,721,693.91 ₱ 2,105,056.00 ₱ 2,528,777.76
           
Noncurrent
assets:          
₱
Equipments ₱ 205,000.00 ₱ 205,000.00 205,000.00 ₱ 205,000.00 ₱ 205,000.00
Accumulated
Depreciation ₱ 13,661.00 ₱ 27,322.00 ₱ 40,983.00 ₱ 54,644.00 ₱ 68,305.00
Total
noncurrent
assets ₱ 191,339.00 ₱ 177,678.00 ₱ 164,017.00 ₱150,356.00 ₱ 136,695.00
₱ ₱
Total Assets ₱ 1,259,791.70 1,554,447.60 1,885,710.91 ₱ 2,255,412.00 ₱ 2,665,472.76
PROJECTED FIVE-YEAR COMPARATIVE SHEET

Current liabilities:          
₱ ₱ ₱ -
Account payable - - ₱ - ₱ -
Total current ₱ ₱ ₱ -
liabilities - - ₱ - ₱ -
Noncurrent ₱ -
liabilities:  
₱ ₱ ₱ -
Loan payable - - ₱ - ₱ -
₱ ₱ ₱ -
Total liabilities
- - ₱ - ₱ -
A, Capital ₱ 251,958.34 ₱ 310,889.52 ₱ 377,142.18 ₱ 451,082.40 ₱ 533,094.55
B, Capital ₱ 251,958.34 ₱ 310,889.52 ₱ 377,142.18 ₱ 451,082.40 ₱ 533,094.55
C, Capital ₱ 251,958.34 ₱ 310,889.52 ₱ 377,142.18 ₱ 451,082.40 ₱ 533,094.55
D, Capital ₱ 251,958.34 ₱ 310,889.52 ₱ 377,142.18 ₱ 451,082.40 ₱ 533,094.55
E, Capital ₱ 251,958.34 ₱ 310,889.52 ₱ 377,142.18 ₱ 451,082.40 ₱ 533,094.55
Total owner's
equity LIABILITIES
₱1,259,791.70 ₱ 1,885,710.91
AND PARTNER’S
₱1,554,447.60 EQUITY₱2,255,412.00 ₱2,665,472.76
Total liabilities and ₱1,259,791.7
owner’s equity 0 ₱1,554,447.60 ₱ 1,885,710.91 ₱2,255,412.00 ₱2,665,472.76

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

PROJECTED FIVE-YEAR STATEMENT OF CASH FLOWS

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

HEAVEN’S DELIGHT
PROJECTED STATEMENT OF CHANGES IN PARTNER’S EQUITY
Year 1
  A. Capital B. Capital C. Capital D. Capital E. Capital
Beginning Capital ₱ - ₱ - ₱ - ₱ - ₱ -
Add: Investment ₱200,000.00 ₱200,000.00 ₱200,000.00 ₱200,000.00 ₱200,000.00
Net Income by
partner's ₱ 51,958.34 ₱ 51,958.34 ₱ 51,958.34 ₱ 51,958.34 ₱ 51,958.34
Less: Withdrawals ₱ - ₱ - ₱ - ₱ - ₱ -
Ending Capital
Balance ₱251,958.34 ₱251,958.34 ₱251,958.34 ₱251,958.34 ₱251,958.34

Year 2
  A. Capital B. Capital C. Capital D. Capital E. Capital
Beginning Capital ₱251,958.34 ₱251,958.34 ₱251,958.34 ₱251,958.34 ₱251,958.34
Add: Investment ₱ - ₱ - ₱ - ₱ - ₱ -
Net Income by
partner's ₱ 58,931.18 ₱ 58,931.18 ₱ 58,931.18 ₱ 58,931.18 ₱ 58,931.18
Less: Withdrawals ₱ - ₱ - ₱ - ₱ - ₱ -
Ending Capital
Balance ₱310,889.52 ₱310,889.52 ₱310,889.52 ₱310,889.52 ₱310,889.52

Year 3
  A. Capital B. Capital C. Capital D. Capital E. Capital
Beginning Capital ₱310,889.52 ₱310,889.52 ₱310,889.52 ₱310,889.52 ₱310,889.52
Add: Investment ₱ - ₱ - ₱ - ₱ - ₱ -
Net Income by
partner's ₱ 66,252.66 ₱ 66,252.66 ₱ 66,252.66 ₱ 66,252.66 ₱ 66,252.66
Less: Withdrawals ₱ - ₱ - ₱ - ₱ - ₱ -
Ending Capital
Balance ₱377,142.18 ₱377,142.18 ₱377,142.18 ₱377,142.18 ₱377,142.18

Year 4
  A. Capital B. Capital C. Capital D. Capital E. Capital
Beginning Capital ₱377,142.18 ₱377,142.18 ₱377,142.18 ₱377,142.18 ₱377,142.18
Add: Investment ₱ - ₱ - ₱ - ₱ - ₱ -
Net Income by
partner's ₱ 73,940.22 ₱ 73,940.22 ₱ 73,940.22 ₱ 73,940.22 ₱ 73,940.22
Less: Withdrawals ₱ - ₱ - ₱ - ₱ - ₱ -
Ending Capital
Balance ₱451,082.40 ₱451,082.40 ₱451,082.40 ₱451,082.40 ₱451,082.40

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

Year 5
  A. Capital B. Capital C. Capital D. Capital E. Capital
Beginning Capital ₱451,082.40 ₱451,082.40 ₱451,082.40 ₱451,082.40 ₱451,082.40
Add: Investment ₱ - ₱ - ₱ - ₱ - ₱ -
Net Income by
partner's ₱ 82,012.15 ₱ 82,012.15 ₱ 82,012.15 ₱ 82,012.15 ₱ 82,012.15
Less: Withdrawals ₱ - ₱ - ₱ - ₱ - ₱ -
Ending Capital
Balance ₱533,094.55 ₱533,094.55 ₱533,094.55 ₱533,094.55 ₱533,094.55

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

Financial Statement Analysis

FINANCIAL STATEMENT ANALYSIS

Return on Sales
  Year 1 Year 2 Year 3 Year 4 Year 5
₱
Net Income ₱ 259,791.70 ₱ 294,655.90 331,263.31 ₱ 369,701.09 ₱ 410,060.76
₱1,260,000.0
Divided by: Net Sales 0 ₱1,323,000.00 ₱1,389,150.00 ₱ 1,458,607.50 ₱ 1,531,537.88
Net Profit
Percentage 21% 22% 24% 25% 27%

Return on Investment
  Year 1 Year 2 Year 3 Year 4 Year 5
Net Income ₱ 259,791.70 ₱ 294,655.90 ₱ 331,263.31 ₱ 369,701.09 ₱ 410,060.76
Divided by: Average ₱1,259,791.7
Total Assets 0 ₱1,407,119.65 ₱1,720,079.26 ₱ 2,070,561.46 ₱ 2,460,442.38
Return on
Investment
Percentage 21% 21% 19% 18% 17%

Working Capital to Total Assets

  Year 1 Year 2 Year 3 Year 4 Year 5
₱1,068,452.7
Current Assets 0 ₱1,376,769.60 ₱1,721,693.91 ₱ 2,105,056.00 ₱ 2,528,777.76
Divided by: Total ₱1,259,791.7
Assets 0 ₱1,554,447.60 ₱1,885,710.91 ₱ 2,255,412.00 ₱ 2,665,472.76
  85% 89% 91% 93% 95%

Breakeven Sales
  Year 1 Year 2 Year 3 Year 4 Year 5
Fixed Cost 165641 165641 165641 165641 165641
Divided by:
Contribution Margin
% 52% 53% 54% 55% 56%
Breakeven Sales ₱ 320,852.26 ₱ 312,934.08 ₱ 305,747.96 ₱ 299,204.30 ₱ 293,227.46

Return on Partner's Equity

  Year 1 Year 2 Year 3 Year 4 Year 5
Net Income ₱ 259,791.70 ₱ 294,655.90 ₱ 331,263.31 ₱ 369,701.09 ₱ 410,060.76
Divided by: Average ₱1,259,791.7
Partner's Equity 0 ₱1,407,119.65 ₱1,720,079.26 ₱ 2,070,561.46 ₱ 2,460,442.38
Return on Partner's
Equity 21% 21% 19% 18% 17%

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

PAYBACK PERIOD

HEAVEN'S DELIGHT PAYBACK PERIOD

Year Net Operating Cash Flows Cumulative Cash Flows

1
₱ 273,452.70 ₱ 273,452.70
2
₱ 308,316.90 ₱ 581,769.60
3
₱ 344,924.31 ₱ 653,241.21
4
₱ 383,362.09 ₱ 728,286.40
5
₱ 423,721.76 ₱ 807,083.85

₱ 1,000,000.00
Computation:
₱ 271,713.60

0.33666093 4.039931157

Payback Period 4 years and 4 months

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

Financial Statement Interpretation

Return on Investments (ROI)

The ROI Percentage of 21% both first and second year of

business operation shows efficiency in generation of income.

The decrease of ROI on the third year which is 19% due to

variable expenses of the business and still on the later

years, ROI decreases.

Return on Sales

The Return on Sales of the business is efficient in

generating profit from the company’s revenue which comes up

21% on its first year of the operation 22%, 24%, 25% and 27%

on the second, third, fourth and fifth year of business

operation respectively.

Cash Flow Ratio

Cash flow ratio results 8.77% in the first year and

decreases in second year which is 8.07% but on the following

years the results are increasing. The business is liquid

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

which that the business can generate more cash over its

current liabilities.

Current Ratio

The business has the ability to pay its liability. Year

1 has 31.80 times of current assets over its current

liabilities and increasing results every year.

Working Capital to Total Assets

The business has the capacity to cover its current

liabilities as computed. Current assets are 85% of the total

assets on the first year of operation and are increasing on

the last years.

Break-even Sales

The Heaven’s Delight has break-even sales in the 1st

year of ₱165,641.00 and in the 2nd year of ₱165,641.00. It

helps to determine how many cakes to bake that would cover

to fixed cost before it would incur a loss to the business.

Return on Partner’s Equity

As evaluated, return on Partner’s Equity is worth

keeping for the 21% on the 1st year and 2nd year; 19% on the

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

3rd year, 18% on the 4th year, and 17% in the 5th year of

business operation.

CHAPTER VI

SOCIO ECONOMIC-STUDY AND ENVIRONMENTAL IMPACT

Socio Economic

The proposed business, “Heaven’s Delight” will bring

satisfaction to customers, who are looking for delicious

pastries with reasonable price. The business could able to

help promote other business by providing delicious and tasty

pastries that will mark to the taste buds of our customers.

Contribution to the Economy

The proposed business can help the economy through

providing employment to individual and could help the other

businesses promote their business through supplying cakes to

the selected cafés, restaurants or any events as their

dessert.

Contribution to the Government

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

As Filipino citizens, the business can contribute to

the government by paying the tax liabilities mandated by the

Bureau of International Revenue. Taxes generated by the

government will be paved back to the constituents in form of

government projects.

Contribution to the Society

Heaven’s Delight pastry business will keep this town

marketable to attract more investors that will help the

community for its improvements and modernizations, which

leads to money placed directly into the society/community.

Environmental Impact

Heaven’s Delight business may encounter problems on the

disposal of chemical waste. In this situation, Heaven’s

Delight pastry shop will ensure to abide the law through RA

9003 and provide a Materials Recovery Facility (MRF).

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

CHAPTER VII

CONCLUSION

Market Feasibility

Based on the survey conducted, 98% are willing to

patronize the services of HEAVEN’S DELIGHT. Thus, the

estimated market share will be sixteen percent (16%) of the

total respondents.

Generally, Heaven’s Delight pastry shop, is seen to be

feasible upon study its location, market demand and the

factors affecting the market. It is recommended that an

extensive study for another aspect of the business

feasibility is conducted and the execution of the marketing

program developed accords to what really satisfies the

market.

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 HINATUAN SOUTHERN COLLEGE
Business Administration Program
Hinatuan, Surigao del Sur

REFERENCES

Caramonte, M.(2012). Model studies of cake baking, Expansion

and heat set of cake batter during baking. Cereal
Chemistry.
Subagjo, A. 2007. Manajemen Pengolahan Kue dan Roti.Graha
Ilmu. Yogyakarta : 23-37.
Subagjo, A. (2017). Effects of ingredients on the
characteristics of rice cakes. Journal of the
Science of Food and Agriculture.
Syarbini, M. 2014. Referensi Komplet A-Z Bakery Fungsi
Bahan, Proses Pembuatan Roti, Panduan Menjadi
Bakepreneur Cetakan Ke-1. Tiga Serangkai Pustaka
Mandiri. Solo.

IMAGES:
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rc=O9Ze2PbD6vp4NM

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Hinatuan, Surigao del Sur

https://www.google.com/search?
q=cake+equipment&sxsrf=AOaemvJnBl9aSXI48wv2sxxe0fi2
3c63Kg:1637715515331&source=lnms&tbm=isch&sa=X&ved=
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2ahUKEwjCsqLc5a_0AhWGrVYBHSuoBgYQ_AUoAXoECAIQAw#img
rc=vsa4-ScomwG7FM

https://www.google.com/search?
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4fd5a_0AhVRAaYKHfikCbMQrNwCKAB6BQgBEKkB&biw=1226&bi
h=554#imgrc=Dr99fMvAbvTX9M

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