School of Management and Accountancy
MANAGEMENT DEPARTMENT
Presented To:
Dr. Kreanne F. Diaz
Instructor, ABMBC4
Submitted By:
Lim, Ronan Seth
Que, Jared Nathan
Villafuerte, Rei Jazz
Nov 27, 2024
A. Background of the Business
This business offers Hungarian sausages to the Ateneo de Zamboanga University
community, with three distinct varieties that cater to different tastes and preferences. Hungarian
sausages are known for their savory flavor and versatility. By providing these sausages with a
variety of options such as bacon, cheese, buns, or rice, we can attract a wide range of students,
faculty, and staff seeking a satisfying and convenient meal option.
B. Basis for Product Prices and Quantities for Sales
Pricing is determined based on the cost of raw materials, packaging, and operational
expenses, with an added margin to ensure profitability. Product prices are designed to remain
affordable to students and staff, balancing quality with value. The plain Hungarian sausage, for
example, is offered with or without bacon and with or without buns, allowing customers to
choose their preferred combination at different price points. Similarly, another variety of
Hungarian sausage includes an option with cheese, served with or without a bun. For those
seeking a more filling meal, the final option is a Hungarian sausage served with or without
cheese and with rice. This flexible pricing strategy supports the goal of catering to a broad
customer base within Ateneo de Zamboanga University.
C. Costs and Expenses Required to Operate the Business
To operate the business smoothly, the following raw materials, packaging, and miscellaneous
supplies are required:
Item Price per Pack/Unit Quantity per Pack/Unit Cost per Serving
Packaging(12) P106.25 50 pieces P2.125
Buns(12) P120 12 pieces P10
Hungarian P381.25 8 pieces P47.66
Sausage(20)
Hotdog Tray(6) P61 25 pieces P2.44
Cooking Oil(1) P1,500 19 liters P78.95
BBQ Stick(4) P53.55 100 pieces P0.54
Hotdog CDO(11) P152.25 16 pieces P9.52
Cheese Melt(2) P430 300 servings P0.7
Note: Each ingredient's cost per serving is calculated by dividing the total package cost by the
number of servings or units.
D. Computation of Net Income
To determine the projected profitability, we calculated the potential sales revenue and deducted
itemized expenses. Here is an overview of the calculations:
1. Projected Sales Revenue: Total revenue generated from sales, based on average sales
volume and product pricing.
Figure 1.0 Projected Sales
Date Sales in a Day
Dec 9 150 orders
Dec 10 160 orders
Dec 11 170 orders
Dec 12 140 orders
TOTAL 620
There would be an estimated sales of 620 orders of the total 4 days of Ateneo Fiesta.
2. Itemized Costs: Includes raw materials, packaging, and operating expenses.
Figure 2.0 Initial Capital
Raw Materials P13,099.25
Packaging P1,855.2
TOTAL P14,954.45
Salary (3) P2,400
Electricity P1,500
Rent P2,000
TOTAL OPEX P5,900
P20,854.45
Figure 3.0 Cost of Goods
Hotdog on stick Hungarian on stick Hotdog buns Hungarian Bun
Hotdog = P9.52 Hungarian = P47.66 Hotdog = P9.52 Hungarian = P47.66
Stick = P0.54 Stick = P0.54 Buns = P10 Buns = P10
Cheese = P0.7 Cheese = P0.7 Cheese = P0.7 Cheese = P0.7
Tray = P2.44 Tray = P2.44 Packaging = P2.125 Packaging = P2.125
Overhead = P0.9816 Overhead = P0.9816 Overhead = P0.9816 Overhead = P0.9816
Figure 4.0 Overhead
Salary P2,400 Divided by 620 orders P0.2583
Electricity P1,500 Divided by 620 orders P0.4133
Rent P2,000 Divided by 620 orders P0.31
Total Overhead P0.9816
3. Net Income: Sales Revenue - Itemized Costs.
Item Monthly Cost
Raw Materials P13,099.25
Packaging P1,855.2
Operational Expenses P5,900
Total Costs P20,854.45
Projected Sales P
Net Income P
E. Scenario Analysis
To analyze potential sales performance, we will use scenario analysis, showing how
variations in sales volumes could impact annual revenue and net income. Here is an example of
how we’ll present this data:
1. Projected Annual Sales (Graph 1)
This column graph will show annual sales under three scenarios:
○ Optimistic: High demand, strong sales volume.
○ Moderate: Stable demand, consistent sales.
○ Pessimistic: Low demand, reduced sales volume.
2. Projected Net Income (Graph 2)
This line graph will illustrate net income projections under the same three scenarios. This
analysis will highlight how changes in demand could impact profitability.
3. Key Figures Comparison Table
This table will summarize and compare the essential financial indicators across each
scenario, helping to understand which factors most influence overall performance.
Scenario Annual Sales Annual Costs Net Income
Optimistic PXX PXX PXX
Moderate PXX PXX PXX
Pessimistic PXX PXX PXX
F. Conclusion
The feasibility of this business depends on several key factors. First, a consistent
customer base within Ateneo de Zamboanga University is crucial for sustaining sales, as demand
stability will impact overall performance. Additionally, cost management is essential to keep raw
material and operational expenses in check, as this will directly affect profit margins. Finally,
adaptability is key; the ability to adjust pricing or variety offerings in response to customer
feedback or cost fluctuations will help the business remain competitive. With effective planning
and management, this Hungarian sausage venture has the potential to become a profitable and
popular food option within the university setting
