Technical Plan

Technical Plan
ETNIKO MERCHANDISE
TECHNICAL PLAN
In order for the operation of Etniko Merchandise to have a smooth-sailing introduction to the market and to secure a sustainable post, the entrepreneurs ought to provide a technical plan emphasizing the qualitative details of the different steps in
production; the process flow diagram; plant or work area, selling area layout; property, plant and equipment; production schedule and to detail the quantitative aspects of direct raw material requirements, indirect raw material requirements, direct labor
requirements, cost of production, product cost per unit, finished goods ending inventory, cost of goods sold, merchandise summary and merchandise inventory. From the strategic plans laid in the tables portrayed in the succeeding pages, the five year projection emphasizes the introductory phase which is expected to have its growths in the ensuing years therein.
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I.
Steps in the Production of Etniko Products
Steps in producing Talahib products Step(s)
1 2 3 4 5 6
Procure the raw materials (talahib) and purchase other inputs (gawgaw(starch), baking soda, dyes, bleach) Set-up the equipment (blender) and utensils (rolling pin, strainer, pales, basins, pressure cooker). Cut the tip of the talahib, and if necessary the bottom if the part is already old. Remove the stalk of the talahib. Cut the leaves into two(2) inches long.
Put the cut talahib into the pressure cooker and add 2 liters of water and 350 grams of baking soda. (The Baking soda will be used for the whole batch) 7 Place the pressure cooker in the range and let the talahib be cooked for 1 hour. 8 After an hour, sift the cooked talahib and let it cool for 5 minutes. 9 Put 2 cups of water and place the talahib in the blender. (10 grams of talahib but maybe increased or lessen depending on the capacity of the blender) 10 Blend for two (2) minutes. When the fiber is extracted, strain it well. 11 Set three (3) water-filled pales for the three series of rinsing. 12 After rinsing, prepare two basins and fill-up with 1 liter of water each. 13 Add 250 ml. bleach for the first basin (first bleaching), and 50 ml. bleach for the second basin. 14 Plunge the rinsed talahib in the first basin and leave for 30 minutes. (While waiting, cook the gawgaw (cassava starch)) 15 For the second bleach, strain the talahib fiber and transfer it to the second basin, let it for 10 minutes. 16 Strain the talahib and mix the gawgaw. Make sure that the gawgaw is evenly distributed. 17 Place the mixture in a plastic cover and spread it evenly and in an approximately 2mm-3mm thickness by using rolling pin. 18 Set it in an area where sunlight is abundant and pick up after an hour. (it depends on the availability of sunlight) 19 Give the talahib fibers to the sewer for it to be converted into final products (bags/pouches/holders) Note: This procedure is for one(1) batch, which is for 1 kilogram of talahib.
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Steps in packaging Step(s)
1 2 3
Purchase materials needed for the packaging (paper bags of different sizes, sticker papers) Print the logo of Etniko in sticker papers and attach it to the paper bags Put the products inside the packages
The entrepreneurs have culminated into series of researches to come up with the procedures aimed at producing affordable, durable and quality talahib Etniko products. Raw materials which are already available and are cheap in the market are used as exemplified in the relatively total cost of raw materials which can be seen in the succeeding pages. The talahib are cut fresh and processed on the same day to ensure that the extracted fibers are durable. Though the fresh talahib leaves may be stored for not more than one day because it will eventually wither when exposed. The human resources in the business are equipped with the skills to execute the steps laid down in the table. The processes are followed in accordance with the step-bystep order with the actual amounts of raw materials that should be used in the production. Etniko Merchandise offers three product lines which are: Bags and laptop/ netbook cases; pouches and coin purses; and eyeglass and pen holders. In the production of such, one batch is assigned for each product line to get the actual product cost per unit.
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II.
The Process Flow Diagram of the Different Activities of the Business

Remarks
Description
Time (mins) 1. Prepare ingredients 3 2. Set-up the equipment, tools and 3 utensils. 3. Cut the tip of the talahib, and if 8 necessary 4. Remove the stalk. 45 5. Cut the leaves into two(2) inches 20 long. 6. Put the cut talahib into the 3 pressure cooker. 7. Add 2 liters of water and 350 g. of 1 baking soda. 8. Place the pressure cooker in the 60 range. 9. Sift the cooked talahib. 5 10. Stand cool. 5 11. Put 2 cups of water and place the 1 talahib in the blender. 12. Blend 2 13.Strain the extracted fiber 5 14. Set three (3) water-filled pales for 5 the three series of rinsing. 15. Rinse 10 16. Prepare two basins and fill-up 3 with 1 liter of water each. 17. Add 250 ml. bleach for the first 5 basin (first bleaching), and 50 ml. bleach for the second basin. 18. Plunge the rinsed talahib in the 30 first basin. 19. Strain the talahib fiber and 10 transfer it to the second basin. 20. Strain the talahib 3 21. Mix the cooked gawgaw into the 20 talahib fiber 22. Place the mixture in a plastic 15 cover and spread it evenly and in a desired size by using rolling pin. 23. Set it in an area where sunlight is 60 abundant 24. Collect 5 25. Give the talahib fabrics to the sewer 25. Packaging 26. Storage
If the bottom part is old, remove too.
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The time required as per the production was based on the hands-on execution of the entrepreneurs on the making of Etniko products. The step that requires the greatest amount of time is the pressurization of the talahib stalks as to soften and fully extract the fibers. The setting up of the final fiber-sheet under the sun light also requires an hour. The procedures where delay can be observed are (*) Standing cool the cooked talahib mixtures; (*) Plunging the rinsed talahib in the first basin; (*) Straining the talahib fiber and transfer it to the second basin; (*) Setting it in an area where sunlight is abundant and (*) Storage. Cutting the leaves and the removal of stalk of the talahib also needs more labor hours as these steps are crucial in the making of a quality product. Only the soft parts of the talahib are taken for the final fiber-sheet to be more appealing.
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III.
`
Layout of Etnikos Work area The working area comprises eight (8) stations with proximity measures as to the
sequence of the steps covered in the production of the Etniko products. The stations are: measuring and cutting, cooking, blending, rinsing, bleaching, mixing, rolling and flattening, and drying. The work areas for measuring and cutting and has the more spacious dimensions as the talahib stalks are still raw and bulky to manage. This is the place where the actual length of the stalks would be curtailed for a more ease of processing. The rinsing and the bleaching stations are adjacent to each other for they both needed water and the output will be used as the input of the bleaching phase. The mixing phase and the rolling and flattening phase are also adjacent for the continuous process and ease management of extracted fiber (dry).
The drying area is subject to changes depending on the availability of sunlight provided that a spacious zone will be at hand.
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Layout of Etnikos Work area

H B
A C E D E
Legend A B C D Measuring and Cutting Cooking Blending Rinsing E F G H Bleaching Mincing Rolling and Flattening Drying
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Table 1: Production Schedule for a Multiple Product Line Business Production Schedule for a Multiple Product Line Business
Product (A)
Total units to be sold in Year 1 (B)
Plus: Desired FG Ending Inventory (C) 32 54 64
Less: FG Beginning Inventory (D)
No. of Units to be Produced (E )
Productio n
Cost per Unit (F)
Total Cost of FG Ending Inventory (G)
Bags and Laptop/ Netbook cases Pouches and Coin Purses Eyeglass and Pen holders Total for Year 1
316 544 639
0 0 0
348 598 703
150 50 40
4,800.00 2,700.00 2,560.00 10,060.00
Product (A)
Productio n
Cost per Unit (F)
363 626 735
32 54 64
364 628 737
150 50 40
4,950.00 2,800.00 2,640.00 10,390.00
Product (A)
Plus: Desired FG Ending Inventory (C)
Productio n
Cost per Unit (F)
418 719 845
33 58 66
33 56 66
418 721 845
150 50 40
4,950.00 2,900.00 2,640.00 10,490.00
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Product (A)
Plus: Desired FG Ending Inventory (C)
Productio n Cost per Unit (F)
Total Cost of FG Ending Inventory (G) 5,100.00 2,900.00 2,720.00 10,720.00
481 827 972
34 58 68
33 58 66
482 827 974
150 50 40
Product (A)
Productio n Cost
per Unit (F)
577 993 1,166
34 58 68
578 995 1168
150 50 40
5,250.00 3,000.00 2,800.00 11,050.00
Etniko started to have a business rule of allotting 10% for the desired finished goods ending inventory and gradually lowers every year as the managing entrepreneurs get to know the trend of customers demand. The business assumption of this allotment is the availability of stocks to be ready for the possible increase in demands especially during months with special events.
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Table 2: Direct Raw Materials Requirement Direct Raw Materials Requirement

PRODUCT:Bags and Laptop/ Netbook cases Direct Material (A) Purchase cost per unit of material (B) Quantity needed per unit to be produced (C) Cost per unit to be produced (D)
talahib dye
gawgaw (starch)
0 5 per pack P 20/ 20 g 10/ piece P 30/ 350 ml P 5 per pack
1/4 kg 2 packs 10 g 1 piece 87. 5 ml 3 packs (assorted color) Direct Material Cost per unit
0 10 10 10 7.5 15 52.5
zipper varnish glitters
PRODUCT: Pouches and Coin Purses Direct Material (A) Purchase cost per unit of material (B) Quantity needed per unit to be produced (C) 1/4 kg 1 pack 5g 1 piece 50 ml 1 pack Cost per unit to be produced (D) 0 5 5 10 4.5 5
talahib dye
gawgaw(starch)
0 5 per pack P 20/ 20 g 10/ piece P 30/ 350 ml P 5 per pack
zipper varnish glitters
Direct Material Cost per unit
29.5
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PRODUCT:Eyeglass and Pen holders Direct Material (A) Purchase cost per unit of material (B) Quantity needed per unit to be produced (C) Cost per unit to be produced (D)
talahib dye gawgaw(starch) varnish glitters
0 5 per pack P 20/ 20 g P 30/ 350 ml P 5 per pack
1/4 kg 1 pack 5g 50 ml 1 pack Direct Material Cost per unit
0 5 5 4.5 5 19.5
The direct material cost per unit of bags and laptop cases; pouches and coin purses; and eyeglass and pen holders are P 52.5, P 29.5 and P 19.5 respectively. Table 3: Direct Materials Cost
Direct Raw Material Cost for a Multiple Product Line Business Product Line (A)
Direct Raw Material Cost per Unit to be produced (B) No. of units to be produced (C) Direct raw material cost per product line (D)
Bags and Laptop/ Netbook cases Pouches and Coin Purses Eyeglass and Pen holders Total direct material cost (for Year 1)
52.50 29.50 19.50
348 598 703
18,270.00 17,641.00 13,708.50 49,619.50
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Direct Raw Material Cost per Unit to be produced (B) No. of units to be produced (C) Direct raw material cost per product line (D)
Product Line (A)
Bags and Laptop/ Netbook cases
52.50 29.50 19.50
364 628 737
19,110.00 18,526.00 14,371.50 52,007.50
Pouches and Coin Purses Eyeglass and Pen holders Total direct material cost (for Year 2)
Product Line (A)
Direct Raw Material Cost per Unit to be produced (B)
No. of units to be produced (C)
Direct raw material cost per product line (D)
52.50 29.50 19.50
418 721 845
21,945.00 21,269.50 16,477.50 59,692.00
Product Line (A)
Direct Raw Material Cost per Unit to be produced (B)
No. of units to be produced (C)
Direct raw material cost per product line (D)
52.50 29.50 19.50
482 827 974
25,305.00 24,396.50 18,993.00 68,694.50
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ETNIKO MERCHANDISE Direct Raw Material Cost per Unit to be produced (B) No. of units to be produced (C) Direct raw material cost per product line (D)
Product Line (A)
Bags and Laptop/ Netbook cases Pouches and Coin Purses Eyeglass and Pen holders Total direct material cost (for Year 5)
52.50 29.50 19.50
578 995 1168
30,345.00 29,352.50 22,776.00 82,473.50
Table 4: Indirect Raw Materials Requirement Indirect Raw Ending Inventory Schedule (Year 1)
Indirect Materials Purchase Cost per unit Quantity to be kept in stock Cost of material per stock
Threads plastic cover bleach (per liter) baking soda (230 g.) Total
10 20 20 60
10 12 12 12
100.00 240.00 240.00 720.00 1,300.00
Indirect Raw Ending Inventory Schedule (Year 2)

11 22 22 66
10 12 12 12
110.00 264.00 264.00 792.00 1,430.00

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12.1 24.20 24.20 72.60
10 12 12 12
121.00 290.40 290.40 871.20 1,573.00

13.31 26.62 26.62 79.86
10 12 12 12
133.10 319.44 319.44 958.32 1,730.30
Indirect Raw Ending Inventory Schedule(Year 5)

14.64 29.28 29.28 87.84
10 12 12 12
146.41 351.38 351.38 1054.15 1903.33
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As the table 4 portrays; the cost of raw materials (indirect) for a years production lies between P1300-P2000. The company would expect a 10% increase of the prices each year. Though it may seem unlikely that a consistent increase of price would happen, the company is practicing conservatism to be able to forecast the cost per unit of production that would determine the price to be set by the company; further giving us an ample space to be flexible in pricing our products as one of our competitive edge.
Table 5: Indirect Material Requirements
Indirect Material Requirements (Year 1) Direct Material Purchase cost per unit of Direct Material 10 20 20 60 Quantity needed per year 3 12 12 12 Cost of Material in stock 30 240 240 720 1,230
Threads plastic cover bleach (per liter) baking Soda (230 g.) Total (Year 1)
Indirect Material Requirements (Year 2)

Direct Material Purchase cost per unit of Direct Material Quantity needed per year Cost of Material in stock
Threads plastic cover bleach (per liter) baking soda (230 g.) Total (Year 2)
11 22 22 66
3 12 12 12
33 264 264 792 1,353

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Indirect Material Requirements (Year 3)

Direct Material Purchase cost per unit of Direct Material Quantity needed per year Cost of Material in stock
12.1 24.2 24.2 72.6
3 12 12 12
36.30 290.40 290.40 871.20 1,488.30
Indirect Material Requirements (Year 4) Direct Material Purchase cost per unit of Direct Material 13.31 26.62 26.62 79.86 Quantity needed per year 3 12 12 12 Cost of Material in stock 39.93 319.44 319.44 958.32 1,637.13
Indirect Material Requirements (Year 5) Direct Material Purchase cost per unit Quantity of Direct Material needed per year Threads 14.641 3 plastic cover 29.282 12 bleach (per liter) 29.282 12 baking soda (230 g.) 87.846 12 Total (Year 5)
Cost of Material in stock 43.923 351.384 351.384 1054.152 1800.843
Since the products of Etniko are more inclined with the direct materials than indirect, the company plans to buy in quantities that would last for about a year of production. Buying in bulk would give the company an advantage upon inflation and other events that would tend to increase the prices of such commodities. It would serve as a strategic edge of the company with regards to pricing the products.
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Table 6: Indirect Materials Cost Year 1 Indirect Material Cost 1230.00 Year 2 1353.00 Year 3 1,488.30 Year 5 1,637.13 Year 6 1,800.84
The company projects a ten percent (10%) increase per year. This is a company policy when it comes to projecting prices as a practice of conservatism. Price increase would attributable to inflation and other events that would compromise the price of a certain products not within the control of the company. Table 7: Indirect Materials Purchases
Year 1 1,230.00 1,300.00 2,530.00 Year 2 1,353.00 1,430.00 1,300.00 1,483.00 Year 3 1,488.30 1,573.00 1,430.00 1,631.30 Year 4 1,637.13 1,730.30 1,573.00 1,794.43 Year 5 1,800.84 1,903.33 1,730.30 1,973.87
Total Indirect Materials Cost Add: Desired Indirect Materials Ending Invty Less: Indirect Materials Beginning Invty TOTAL INDIRECT MATERIALS PURCHASES
Graph for Table 7: Indirect Materials Purchases
Indirect Materials Purchases

3000
2500
Peso Amount 2000 1500 1000 500
Total Indirect Materials Cost

Add: Desired Indirect Materials Ending Inventory Less: Indirect Materials Beginning Inventory Total Indirect Materials Purchases
0 Year 1 Year 2 Year 3 Year 4 Year 5
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Table seven shows the indirect materials purchases for five years of Etniko. During the first year of operation, the company had the largest amount of purchases. This is so because the company is still starting the business. It had not yet perfected the process that would require minimum materials yet would yield the maximum numbers of products. An allowance for production of defective products is also taken into account. An increase over the years indicates the increase in the volume of production to satiate the growing demands of the customers.
Table 8: Manpower Requirements

No. of Employees DIRECT LABOR Cutters and Boilers Drainers, and Strainers Refiners, and Molders Sewers INDIRECT LABOR Embellishers SALES STAFF ADMINISTRATIVE STAFF 1 1 1 2 Salary/Month 0 0 0 1500 Annual Salary 0 0 0 19500 19500 0 0 1500 0
1 3 0
0 500 0
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Graph of Table 8: Manpower Requirements
Number of Employees
0% 11% Cutters and Boilers Drainers, and Strainers 11% 11% 11% 22%
34%
Refiners, and Molders Sewers Embellishers SALES STAFF ADMINISTRATIVE STAFF
As indicated in the table, the direct labor has no salary. It is due to the fact that the partners would be hands-on on the production of the products to ensure its quality. This is also assurance that the products are made as the owners visualized.
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Table 9: Cost of Production

Year 1 49,619.50 19500 0 1230 600 0 1500 1200 900 74,549.50 Year 2 52,007.50 19500 0 1353 630 0 1500 1260 945 77,195.50 Year 3 59,692.00 19500 0 1488.3 661.5 0 1500 1323 992.25 85,157.05 Year 4 68,694.50 19500 0 1637.13 694.575 0 1500 1389.15 1041.8625 94,457.22 Year 5 82,473.50 19500 0 1800.843 729.30375 0 1500 1458.6075 1093.9556 108,556.21
Direct materials Direct Labor Production Overhead Indirect Labor Indirect materials Repair and Maintenance Depreciation Transportation Expense Light and Power Water Total Cost of Production
Graph of Table 9: Cost of Production
Total Cost of Production

Year 1 Year 2 Year 3 Year 4 Year 5 108,556.21
94,457.22 74,549.50 77,195.50 85,157.05
The total cost of production is increasing due to the increase in the units to be produced. The increase in the total production is in line with the business strategy of expanding as moves into stability.
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Table 10: Total Cost of Production for Product Line#1 : Bags and Laptop/Netbook cases
Direct materials Direct Labor Production Overhead Indirect Labor Indirect materials Repair and Maintenance Depreciation Transportation Expense Light and Power Water Total Cost of Production
Year 1 Year 2 Year 3 Year 4 Year 5 29,771.70 31,204.50 35,815.20 41,216.70 49,484.10 11,700.00 11,700.00 11,700.00 11,700.00 11,700.00 0 738 360 0 811.8 378 0 892.98 396.9 0 982.28 416.75 0 1260.59 437.58
900 900 900 900 900 720 756 793.8 833.49 875.16 540 567 595.35 625.12 656.37 44,729.70 46,317.30 51,094.23 56,674.33 65,313.81
Graph of Table 10
70,000.00 60,000.00 51,094.23 50,000.00 40,000.00 30,000.00 44,729.70 56,674.33 65,313.81
46,317.30
20,000.00 10,000.00 0.00

Year 1
Year 2
Year 3
Year 4
Year 5
As the direct material and indirect material expectedly increases in each year, so thus the total cost of production. Light and power is also expected increase as more demands must be fulfilled by the business, more energy is allotted to production.
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Table 11: Total Cost of Production for Product Line# 2: Pouches and Coin Purses
Pouches and Coin Purses Year 1 Year 2 Year 3 Year 4 Year 5 14,885.85 15,602.25 17,907.60 20,608.35 24,742.05 5,850.00 5,850.00 5,850.00 5,850.00 5,850.00
Direct materials Direct Labor Production Overhead Indirect Labor 0 0 0 0 0 Indirect materials 369 405.9 446.49 491.14 540.25 Repair and Maintenance 180 189 198.45 208.37 218.79 Depreciation Transportation Expense 450 450 450 450 450 Light and Power 360 378 396.9 416.75 437.58 Water 270 283.5 297.68 312.56 328.19 Total Cost of Production 22,364.85 23,158.65 25,547.12 28,337.17 32,566.86
Graph of Table 11

Year 1 Year 2 Year 3 Year 4 28,337.17 22,364.85 Year 5
32,566.86 23,158.65 25,547.12
The same also holds true for pouches and coin purses. As the direct material and indirect material expectedly increases in each year, so thus the total cost of production. Light and power is also expected increase as more demands must be fulfilled by the business, more energy is allotted to production. The gradual increase in the cost of
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production in each year also indicates that pouches and coin purses have the most potential to be sold. Pouches and coin purses never go out of style. Table 12: Total Cost of Production for Product Line# 3: Eyeglass and Pen holders
Eyeglass and Pen holders Year 1 Year 2 Year 3 Year 4 Year 5 9,923.90 10,401.50 11,938.40 13,738.90 16,494.70 3,900.00 3,900.00 3,900.00 3,900.00 3,900.00
Direct materials Direct Labor Production Overhead Indirect Labor 0 0 0 0 0 Indirect materials 246 270.6 297.66 327.43 360.17 Repair and Maintenance 120 126 132.3 138.92 145.86 Depreciation Transportation Expense 300 300 300 300 300 Light and Power 240 252 264.6 277.83 291.72 Water 180 189 198.45 208.37 218.79 Total Cost of Production 14,909.90 15,439.10 17,031.41 18,891.44 21,711.24
Graph of Table 12

Year 1 Year 2 Year 3 Year 4 Year 5 21,711.24 14,909.90 15,439.10 17,031.41 18,891.44
Though eyeglass and pen holders have the lowest cost of production among the three product lines, the expected increase on its cost of production will nevertheless still suggest that sufficient supply is produced to the demand of the market on eyeglass and penholders.
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ETNIKO MERCHANDISE Table 13: Cost per Unit
Bags and Laptop/ Netbook cases Year 1 Year 2 Year 3 Year 4 Total Cost of Production44729.7 46317.3 51094.23 56674.33 Units to be produced 348 364 418 482 Product cost per unit 128.5336 127.2453 122.235 117.5816 Pouches and Coin Purses Year 1 Year 2 Year 3 Year 4 Total Cost of Production 22364.85 23158.65 25547.12 28337.17 Units to be produced 598 628 721 827 Product cost per unit 37.39941 36.87683 35.43289 34.26501 Eyeglass and Pen holders Year 1 Year 2 Year 3 Year 4 Total Cost of Production 14,909.90 15,439.10 17,031.41 18,891.44 Units to be produced 703 737 845 974 Product cost per unit 21.20896 20.94858 20.15551 19.39573
Year 5 65313.81 578 112.9997
Year 5 32566.86 995 32.73052
Year 5 21,711.24 1168 18.58839
Graph for Table 13. Cost per Unit

140 120
100 80 60 40
Year 1 Year 2 Year 3 Year 4 Year 5

Bags and Laptop/ Netbook cases Pouches and Coin Purses Eyeglass and Pen holders
20
0
Since the cost of production is a variable cost, the unit cost is supposedly unchanging. However, since the total increase in the units to be produced is larger than the increase in the cost of production, the cost per unit tends to decline. The decline in units cost is advantageous on the cost pricing strategy of the business.
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ETNIKO MERCHANDISE Table 14: Production Cost per Unit
Graph for Table 14: Production Cost per Unit
PRODUCTION COST PER UNIT

88.04
41.94 25.74
Bags and Laptop/Netbook Pouches and Coin Purses Cases
Eyeglass and Pen Holders
Due to higher direct labor cost, the product cost per unit for bags and laptop/netbook cases are relatively higher than pouches and coin purses and eyeglass and pen holders. Also, the pouches and coin purses product cost per unit is relatively higher than eyeglass and en holders. The difference in product cost per unit is justified by the corresponding computations of cost of production from the previous table.
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ETNIKO MERCHANDISE Table 15. Finished Goods Inventory
Finished Goods Inventory for Etniko Merchandise (Year 1) Product Cost Desired ENDING Product Line per Unit Finished Goods Inventory FINISHED GOODS INVENTORY Bags and Laptop/Netbook Cases 88.04 32 2817.28 Pouches and Coin Purses 41.94 54 2264.76 Eyeglass and Pen Holders 25.74 64 1647.36 Total finished goods ending inventory (Year 1) 6729.4
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Graph for Table 15. Finished Goods Inventory
Finished Goods Inventory

6729.4 6952.8 7036.68 7176.2 7399.6
Year 1
Year 2
Year 3
Year 4
Year 5
As the business becomes stable and the demand for the talahib product increases, Etniko will need to maintain higher finished goods inventory each year. Table 16. Cost of Goods Sold
Cost of Goods Sold for Etniko Merchandise Year 1 Year 2 Year 3 Total cost of production 74,549.50 77,195.50 85,157.05 Add: F. G. beginning inventory 6,729.40 6,952.80 Total cost of goods available for sale 74,549.50 83,924.90 92,109.85 Less: F. G. ending inventory 6,729.40 6,952.80 7,036.68 TOTAL COST OF GOODS SOLD 67,820.10 76,972.10 85,073.17
Year 4 94457.22 7,036.68 101,493.90 7,176.20 94,317.70
Year 5 108556.21 7,176.20 115,732.41 7,399.60 108,332.81
Graph of Table 16
Total Cost of Goods Sold

3 1 20,000.00 40,000.00 60,000.00 80,000.00 100,000.00120,000.00
TOTAL COST OF GOODS SOLD
In effect, the cost of goods sold will match up the finished goods inventory.
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ETNIKO MERCHANDISE Table 17: Total Merchandise Cost
Year 1 (9.15%)
Product Total Units to be Sold in Yr. 1 Plus: Desired Ending Inventory Less: Beginning Inventory No. of Units to be Produced Purchase Cost per Unit Total Cost of Merchandise Purchases
Bags and Laptop/Netbook Cases Pouches and Coin Purchases Eyeglass abd Penholders Total
316.00 544.00 639.00 1,499.00
54.00 51.00 46.00 151.00
370.00 595.00 685.00 1,650.00
128.50 37.40 21.20 187.10
47,545.00 22,253.00 14,522.00 84,320.00
Year 2 (7.36%)
Product Total Units to be sold in Yr. 2 Plus: Desired Ending Inventory Less: Beginning Inventory No. of Units to be Purchased Purchase Cost per Unit Total Cost of Merchandise Purchases
363.00 626.00 735.00 1,724.00
47.00 42.00 36.00 125.00
54.00 51.00 46.00 151.00
356.00 617.00 725.00 1,698.00
127.20 36.90 20.90 185.00
45,283.20 22,767.30 15,152.50 83,203.00
Year 3 (6.4%)
418.00 719.00 845.00 1,982.00
22.00 35.00 39.00 96.00
47.00 42.00 36.00 125.00
393.00 712.00 848.00 1,953.00
122.20 35.40 20.15 177.75
48,024.60 25,204.80 17,087.20 90,316.60
Year 4 (5.41%)
481.00 827.00 972.00 2,280.00
34.00 43.00 48.00 125.00
22.00 35.00 39.00 96.00
493.00 835.00 981.00 2,309.00
117.50 34.30 19.40 171.20
57,927.50 28,640.50 19,031.40 105,599.40
Year 5 (6.4%)
577.00 993.00 1,166.00 2,736.00
55.00 67.00 58.00 180.00
34.00 43.00 48.00 125.00
598.00 1,017.00 1,176.00 2,791.00
113.00 32.70 18.50 164.20
67,574.00 33,255.90 21,756.00 122,585.90
80
Technical Plan
ETNIKO MERCHANDISE
Cost of Goods Sold

Total Sales Less: Average Mark-up (30%) Total Cost of Goods Sold Year 1 100,160.00 18,155.55 82,004.45 Year 2 115,184.00 30,268.95 84,915.05 Year 3 132,462.00 38,789.24 93,672.76 Year 4 152,331.00 48,428.06 103,902.94 Year 5 182,797.00 63,205.09 119,591.91
Merchandise Inventory
Merchandise Inventory, Beginning Add: Merchandise Purchases Less: Cost of Goods Sold Merchandise Inventory, Ending Year 1 84,320.00 82,004.45 2315.55 Year 2 151.00 83,203.00 84,915.05 -1561.05 Year 3 125.00 90,316.60 93,672.76 -3231.16 Year 4 96.00 105,599.40 103,902.94 1792.46 Year 5 125.00 122,585.90 119,591.91 3118.99
81

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Technical Plan

Steps in the Production of Etniko Products

Steps in producing Talahib products Step(s)

Steps in packaging Step(s)

The Process Flow Diagram of the Different Activities of the Business

If the bottom part is old, remove too.

Layout of Etnikos Work area

Total units to be sold in Year 1 (B)

Plus: Desired FG Ending Inventory (C) 32 54 64

Less: FG Beginning Inventory (D)

No. of Units to be Produced (E )

Cost per Unit (F)

Total Cost of FG Ending Inventory (G)

316 544 639

348 598 703

4,800.00 2,700.00 2,560.00 10,060.00

Total units to be sold in Year 1 (B)

Plus: Desired FG Ending Inventory (C) 33 56 66

Less: FG Beginning Inventory (D)

No. of Units to be Produced (E )

Cost per Unit (F)

Total Cost of FG Ending Inventory (G)

363 626 735

364 628 737

4,950.00 2,800.00 2,640.00 10,390.00

Total units to be sold in Year 1 (B)

Plus: Desired FG Ending Inventory (C)

Less: FG Beginning Inventory (D)

No. of Units to be Produced (E )

Cost per Unit (F)

Total Cost of FG Ending Inventory (G)

418 719 845

418 721 845

4,950.00 2,900.00 2,640.00 10,490.00

Total units to be sold in Year 1 (B)

Plus: Desired FG Ending Inventory (C)

Less: FG Beginning Inventory (D)

No. of Units to be Produced (E )

Productio n Cost per Unit (F)

Total Cost of FG Ending Inventory (G) 5,100.00 2,900.00 2,720.00 10,720.00

481 827 972

482 827 974

Total units to be sold in Year 1 (B)

Plus: Desired FG Ending Inventory (C) 35 60 70

Less: FG Beginning Inventory (D)

No. of Units to be Produced (E )

per Unit (F)

Total Cost of FG Ending Inventory (G)

577 993 1,166

578 995 1168

5,250.00 3,000.00 2,800.00 11,050.00

Table 2: Direct Raw Materials Requirement Direct Raw Materials Requirement

0 5 per pack P 20/ 20 g 10/ piece P 30/ 350 ml P 5 per pack

zipper varnish glitters

0 5 per pack P 20/ 20 g 10/ piece P 30/ 350 ml P 5 per pack

zipper varnish glitters

Direct Material Cost per unit

talahib dye gawgaw(starch) varnish glitters

0 5 per pack P 20/ 20 g P 30/ 350 ml P 5 per pack

1/4 kg 1 pack 5g 50 ml 1 pack Direct Material Cost per unit

52.50 29.50 19.50

348 598 703

18,270.00 17,641.00 13,708.50 49,619.50

Product Line (A)