Chapter-5

Financial plan

Now the most important chapter in over innovation is to determine the financial plan.

For, establishing any project, following points are requiring to be considered.

1. What is total finance required for the project?

2. What will be the requirement of working capital?
3. How we are going to finance requirement of the project?

What is total finance required for the project?

Our project is on establishing chips mill. For determine the requirement of finance , we have to find
out the things which are most important to our project.

 Land
 Building
 Plant &machinery
 Other assets

land

our total requirement of land sq.feet. we have determine on the basis of following
classification:-

particular land requirement

main shed

storage room

office building

total

we are planning to establish our mill at KADI GIDC so we have considered following rate.

So our total cost of land will be

Building

In constriction of building , we have considered following points:-

 Office
 Production hall
 Storage room
 Compound wall
For all our construction ,we have considered rate at RS------- per sq. Meter.

Cost of office Office-------------------------------------

Production hall------------------------------------

Storage room------------------------------------------

Compound wall------------------------------------------------

Total

Plant &Machinery

As we have mentioned in technical plan we required plan, following type pf machinery and cost

Of that machinery this cost of machinery also include cost of erection and transportation cost of
machinery.

Table of machinery costs

Particulars

Working capital required

For working capital required we have to consoder following aspects

Raw materials

Finished good

Debtors

Minimum cash requires

Creditors

Assumptions

We are assumptions here that we will give one months credit to our debtors

We will keep cash for one months

We will keep stocks of raw material for half a months

We will also keep stocks of finished goods as 10 percents of sale

We are planning to purchase our raw material at credit period of one months

Ownars contribution

Equity

So total equity capital is required for the projects rs ________ so we will issue _____

Equity shres of rs ____ each out of which contribution of promotars will be rs ______

Debt

We have taken one loans one froms sbi of rs a______at__%of interest rate payebal in____

Yeras

Now next important thiong is how we have derived our selling price all date in detail are shown
in annexure.