EXECUTIVE SUMMARY

INTRODUCTION TO INDUSTRY
Corn Plastic is basically the production of plastic using PLA (Polylactic Acid) derived from
corn. It is one of the most natural ways of producing eco friendly plastic bags which are
completely bio-degradable within 4-6 months of time period. A huge market exists in abroad
countries like USA and Canada. But in India this method has not come into existence till now.
Though the government has taken huge measures to reduce the use of plastic bags but they have
not come up with its alternate solutions other than the use of paper bags which also harms
environment in some or the other way.
Polylactic acid (PLA), a plastic substitute made from fermented plant starch (usually corn) is
quickly becoming a popular alternative to traditional petroleum-based plastics. As more and
more countries and states follow the lead of China, Ireland, South Africa, Uganda and San
Francisco in banning plastic grocery bags responsible for so much so-called white pollution
around the world, PLA is poised to play a big role as a viable, biodegradable replacement.
PLA Helps to Reduce Greenhouse Gas Emissions
Proponents also tout the use of PLAwhich is technically carbon neutral in that it comes from
renewable, carbon-absorbing plantsas yet another way to reduce our emissions of greenhouse
gases in a quickly warming world. PLA also will not emit toxic fumes when incinerated.

Green-Minded Consumers May Prefer Alternatives to Plastics

While PLA has promise as an alternative to conventional plastic once the means of disposal are
worked out, consumers might be better served by simply switching to reusable containersfrom
cloth bags, baskets and backpacks for grocery shopping (most chains now sell canvas bags for
less than a dollar apiece) to safe, reusable (non-plastic) bottles for beverages.

THE PROJECT

The main idea of Green Plastic is to lead the country towards better and cleaner environment by
tackling one of the major issues of environment, Plastic. Plastic bags are very frequently used in
most of the stores in India whether it is big or small. Ranging from Big Bazaar to a small grocery
store in a locality, everywhere plastic bags are used. Plastic, as we are all very much aware of it
are non-biodegradable substance which do not degrade for millions of years and hence is harmful
for the environment.
To overcome this issue we have come up with an alternative of plastic bags made of
Polyethylene (HDPE) commonly used in the stores. We have introduced the concept of Corn
plastic in India. Corn plastic is made from PLA (Polylactic Acid) derived from corn. Polylactic
acid is polyester derived from corn starch which decomposes and mineralizes into water and
carbon dioxide when composted in about 4-6 months.
Corn Plastic is a new concept in India and hence people are less aware of it. Our main motive is
to create a general awareness in the society as well as corporate level and take initiative towards
cleaner and greener environment.

TYPE OF ORGANISATION
The business is a partnership firm of 2 partners who has contributed equal capital for opening
and running of the business. Both of them act as the active members in the functioning of the
business. It is registered under Partnership Act of 1932 and had limited liability. The profit or
loss is shared between the partners equally.

USP
Our main USP is the eco-friendliness of our product. Creation of Corn Plastic tackles one of the
major issues of the environment. It is not only cost effective but also a more reliable product.
Unlike other plastic bags made of Polyethylene (HDPE), our corn plastic bags are made of
Polylactic Acid which is a bio-degradable substance.
Also another important feature in our production process is that we use the waste remains of corn
as a source of energy. With this we utilise the waste product as well and also the other sources of
fuel are saved. Also our production process constitutes of natural ways which have been used
from millions of years such as fermentation.
We help to create awareness through new marketing techniques and try to make the buyers
concerned towards environment. As this concept is new to India we have used various awareness
programmes in different communities and increased our horizon.

ADDRESS
green Plastic
G T Road, Jalandhar
Punjab

GENERAL FIRM DESCRIPTION

OUR VISION
Our vision is to make all the citizens of India aware of the major issues like plastic and make
them socially responsible. We help them do their bit what they can do toward the environment
with the use of Corn Plastic in everyday purpose.

OUR MISSION
Our mission for now is to increase our horizons from the biggest of stores like Star Bazaar to the
smallest of stores in the locality. To create the awareness and make everyone socially responsible
so that they understand the usefulness of Corn Plastic.
To provide the nation with cleanest of products and safe for environment.

THE OBJECTIVE

To create awareness about major issues relating the environment among the citizens.
Come up with best solution to tackle the problems of recycling and decomposing.
Provide training to the unskilled labourers of the region and give them guaranteed
employment with a fair share of salary.
To make use of natural resources which have been untapped from years and enhance the
potential of Indian companies as well as the nation in broad terms.

PRODUCT AND THE SERVICE

Our product Corn Plastic is made from PLA (Polylactic Acid) derived from corn. Polylactic acid
is polyester derived from corn starch which decomposes and mineralizes into water and carbon
dioxide when composted in about 4-6 months. It is derived from a renewable resource such as
corn starch.
PLA Helps to Reduce Greenhouse Gas Emissions
The resin, known as polylactic acid (PLA), will be formed into sheets and then plastic bags. The
trendy plastic has several things going for it. Its made from a renewable resource, which means
it has a big leg upboth politically and environmentally.
We basically contact the big super markets like Big bazaar, Star bazaar, More and major brands
like Westside, Shoppers Stop etc and persuade them to use our product. These days all the major
firms and industries have a CSR component in their business and like to do as much as possible
for the betterment and development of the society. They also have the aim of Go Green and
make their firm as eco friendly as possible. They would surely like our product as besides being
eco friendly our product is also cost-effective.
As the business expands and our product awareness increases we expect to reach the local stores
in the locality. Instead when they have understood the effectiveness of our product we expect
them to contact us for the product.
Meanwhile we conduct various campaigns, petition signing programmes and other marketing
techniques to promote Corn Plastic.
We basically act as the whole seller instead of giving away our corn plastic bags to the retailers.
This would decrease the cost of product as the distribution channel is not elongated.
We also carry out our awareness programs through indirect marketing. In every corn plastic bag
that we sell to the store be it super market or a small grocery store, we write a small line about
our product and how it is beneficial for the customer as well as the environment as a whole.
Just saved the environment by using degradable plastic bag!

This would make the customers proud that in some or the other way even they are contributing
the society by preferring Corn Plastic over other plastic bags which are harmful for the
environment.

MARKETING
STP ANALYSIS

SEGMENTATION
Market segmentation is undertaken in order to focus on the subsets of the prospects that are most
likely to purchase our offering. This will in turn help us take the best returns from our marketing
and entertainment expenditures. Based on the need our service satisfies, the market is segmented
into diverse sections.

Demographic - Super Markets as well as the small retail store gradually.

Geographic Mainly metropolitan city.
Behavioural- People who are aware of the basic issues of the society and are ready to take a step
ahead to do their bit in tackling those problems by becoming socially responsible.

TARGETING
Targeting the right customers is one of the most important criteria as the growth and expansion
of business relies on catering to the right customers and enters the right market.
Initially our main target would be the bigger chain of stores like Big Bazaar, Star Bazaar,
Westside and other major brands who still use the plastic bags which are harmful to the
environment. They should realise the importance of using Corn Plastic and run in our favour.
They would also accept out product as it is more cost effective than the normal plastic bag. We
would approach the major stores and convince them to use our product because of its basic
advantages.
On the later stage when enough awareness is created through stores and other marketing
techniques we would target the small retail stores in the locality. By the time they would have
become aware of our product and would surly support our initiative.
This way we target the major stores to the small retail stores.

POSITIONING
We would position ourselves as a socially responsible business firm who caters to the basic need
of the society with keeping in mind the value of society and the environment.

4Ps OF MARKETING

PRODUCT
Corn Plastic is basically the production of plastic using PLA (Polylactic Acid) derived from
corn. Polylactic acid is polyester derived from corn starch which decomposes and mineralizes
into water and carbon dioxide when composted in about 4-6 months.
Although PLA has been known for more than a century, it has only been of commercial interest
in recent years, in light of its biodegradability.

The resin, known as Polylactic acid (PLA), will be formed into sheets and then will be cut into
pieces to design a corn plastic bag. The trendy plastic has several things going for it. Its made
from a renewable resource, which means it has a big leg upboth politically and
environmentally.
The bags are designed in all shapes and sizes according to the needs and requirements of the
dealers. Our product being bio degradable will get degraded within 4-6 months so it cannot be re
used. But on the brighter side it can be degraded and exit naturally among the heap.

PRICE
We have kept a very liberal pricing policy keeping in mind the cost effectiveness. Our product
besides being eco friendly it is also reasonable as compared to other plastic bags commonly used.
We provide several ranges of corn plastic bags ranging in thickness and size according to the
preference of our customers.

PLACE
Our production sector is based in Punjab. We have chosen Punjab because our chief raw material
that is Corn comes from Punjab as it is one among the largest production state of corn in India.
We set up our production base in Punjab itself and also in the same district as the dealer of maize
so that our transportation cost is minimal.
We have acquired the land on rent. Our total area is 6000 sq. ft.
Price per square feet is Rs. 7
Hence, monthly rent comes upto Rs. 42000
And the yearly rent amounts to Rs.5,04,000

ADDRESS
Green Plastic
G T Road, Jalandhar
Punjab

PROMOTION

INDIRECT MERKETING THROUGH THE CORN PLASTIC BAGS SOLD AS

PRODUCT TO THE STORES
In this case we go ahead with indirect marketing with the product itself by promoting it. The
Corn Plastic bag we sell has a small line printed at the bottom of it which describes the
usefulness of the product.

When you think about plastics, think Green!

There are two objectives of this kind of marketing. It serves the purpose of general awareness
also by making the buyer curious as to why are we emphasising on Frumentics and asking them
to divert their attention towards it. The second purpose is the advertisement of our company.

Also our main aim is to highlight the line written below the corn plastic bag so we use
contrasting colours with the colour of the plastic bag. For example if the plastic bag is of green
colour, we use red colour to print the line so that it outshines and is highlighted.

Creation of awareness campaigns and carry out small plays and skits
Through this we ask people to voluntarily join us and from a group to carry out awareness
campaigns especially in schools and colleges. We also target places like malls and famous
shopping streets.
In places like malls and shopping streets we can create personal awareness by distribution of
pamphlets with the advantages of corn plastic bags. We can also provide them with a small
questionnaire consisting of few simple questions which would be related their contribution
towards the society and the environment. this would give them a chance to self evaluate and they
would more likely become aware of their contribution to save the environment in the simplest
ways possible such as adaption of corn plastic bags.
In schools and colleges we can conduct small skits to make the students aware of Corn plastic
bags. In this case we would be promoting the corn plastic bag industry as a whole rather than
Green Plastic particularly. The initiative of the plays and skits would be taken by the students of
schools and colleges voluntarily.

Creation of website and fan pages

It is one of the most common methods of marketing. We will create a website and post various
issues related to plastic towards the environment. We will also provide the facility for the visitors
to our website to comment on the issue.
Other than this we will create our fan page in various websites such as Facebook, Orkut, etc.

Distribution of Pamphlets
Another method of our promotion is the distribution of pamphlets outside the malls.

ENTERING THE MARKET THROUGH DIFFERENT OTHER

INDUSTRIES
It is another indirect way of marketing where the product is diversified through sales. Our target
market ranges from clothing brands, departmental stores to super markets. This way we have our
product component in most of the other industry. When buyers buy the different products of
different industries and notice our Green Plastic bags used everywhere the value and the brand
name increases. They will notice our bags as in every bag the caption is written which is related
to corn plastic and the environment.

SWOT ANALYSIS

STRENGTHS
Manpower required is less
Affordable
Future Oriented

WEAKNESS
It cannot be recycled.
The market awareness is very low
at initial stage
People have low mentality at
lower levels and would still prefer
other plastic bags commonly
used other than our corn plastic
bags

OPPORTUNITY

THREATS

Extensive demand in future

Paper bag industry.

Lesser compitition in the market

as the concept is very much new
to India

In te later stage as our business

expands others might see the
potential of corn plastic bag
industy and its market and could
create compitition for us by
coming up with same line of
business.

Easy availability of raw materials

as India is 7th largest producer of
corn.

STRENGTHS
Manpower required is less
Affordable
Future Oriented

WEAKNESS
It cannot be recycled.
The market awareness is very low at initial stage
People have low mentality at lower levels and would still prefer other plastic bags
commonly used other than our corn plastic bags
OPPORTUNITY
Extensive demand in future
Lesser competition in the market as the concept is very much new to India
Easy availability of raw materials as India is 7th largest producer of corn.

THREATS
Paper bag industry.
In the later stage as our business expands others might see the potential of corn plastic
bag industry and its market and could create competition for us by coming up with same
line of business.
Problems if not differentiated from conventional plastic during recycling. Could cause
some pollution in the process as it acts as a contaminant.

HUMAN RESOURCE

ORGANIZATION STRUCTURE

SENIOUR
MANGERS

ACCOUNTING
MANAGER

PRODUCTION
MANAGER

MARKETING
MANAGER

SALES
MANAGER

ACCOUNTING
DEPARTMENT

CLERK
UNION LABOUR
HEAD

WAREHOUSE
INCHARGE

TECHNICIAN
VOLUNTEERS
AWARENESS
PROGRAMMER

LABOURERS

SECURITY
GUARD

EMPLOYEE REMUNERATION
POST
SENIOR MANAGER

NUMBER OF
PEOPLE
1

SALARY PER PERSON

PER MONTH
20,000

ACCOUNTING MANAGER

15,000

MARKETING MANAGER

13,000

SALES MANAGER

13,000

TECHNICIAN

12,000

LABOURERS

160

SECURITY GUARD

4,000

AWARENESS PROGRAMMER

4,500

ACCOUNTANTS

10,000

CLERK

5,000

WAREHOUSE INCHARGE

5,000

TOTAL

20

HR POLICIES
Proper training is provided to the unskilled labour force. We had emphasised mainly on
the employment of unskilled labourers from the nearby area in Jalandhar district of
Punjab. Since they are unskilled we provide them with proper training before they start
working so that they are well aware of their job.

LEAVE POLICY
Any employee of the company will have to give a prior notice of 1 month to the Senior
Manager. Senior Manager will have to inform the Directors of the company.The leave
will be sanctioned only if it is approved and signed by any 1 of the directors.

FINANCE

SOURCE OF CAPITAL

PARTICULARS

AMOUNT

Promoter 1

7,00,000.00

Promoter 2

7,00,000.00

Personal Capital

14,00,000.00

Unsecured loan

10,00,000.00

TOTAL

24,00,000.00

The unsecured loan will be taken at the rate of 15 percent from the relative of promoter. This is
the loan which is not backed by any kind of mortgage and the loan is completely on trust. The
loan is taken from the relative of one of the promoters. The remaining money will be taken from
the promoters and they will be sharing profit on the capital basis. The ratio in which they will
share 1:1. The amount will be written off in after 5 years which is taken as unsecured. Since the
land taken on rent cannot mortgage, and the firm at the moment does not have any asset, the only
form available to us in unsecured loan.

INITIAL INVESTMENT

PARTICULARS
ASSETS(A)
MACHINERY
LARGE
FERMENTATION
TANKS
FURNITURE AND
FIXTURES
AIR
CONDITIONERS
DESKTOP AND
PRINTERS

FIRE
EXTINGUISHERS
COFFEE MACHINE
TELEPHONE AND
NET
CONNECTIONS
WATER PURIFIER
LIGHTS AND FANS

TOTAL(A)
START UP
EXPENSES (B)
SECURITY
DEPOSIT
LEGAL CHARGES
TRADE LICENCE
MARKETING
EXPENSES
RECRUITMENT
AND TRAINING
EXPENSES

AMOUNT
(IN RUPEES)

DESCRIPTION

6,94,050.00 All the machinery required for production process

details given below
1,62,000.00 6 Fermentation Tank (D4 FT02), highly
recommended for fermentation process
35,400 Office and factory furniture and fixture details given
below
19,770.00 LG LSA2CG5AF8 Split Air Conditioner
56,000.00 2NOS.Acer Laptop AMD processor Athelon 4200
1.86 GHzdual core Acer751, Ram 1 GB DDR2, HD
160 GB with 15 TFT monitor and hp
printer@Rs.28,000.
2,430.00 ABC Type Fire Extinguisher - 1Kg Capacity, Fire
Extinguisher
1,249.00 Vega Coffee Maker
6,700.00 Airtel telephone connection Rs.1800 and D LINK
Wi Fi Router RS.2500 and telephone wires RS.2400
1,950.00 Eureka water purifier @ Rs. 1950 each
21,520.00 10Cfl bulbs @ Rs. 140 EACH, 5 bajaj energy smart
fan @ Rs. 1555, and fitting of bulbs including wiring
Rs.12,345
10,01,069.00

2,00,000.00 Security deposit kept against land taken on rent.

2,000.00 Rs. 1000 for the stamp and Rs. 1000 for registration
of partenership under Partnership Act 1932
1,000.00 To carry out any kind of trade
80,000.00 Break ups given below.
25,000.00 Basic recruitment and training of unskilled labourers.

45,000.00

MISCELLANEOUS
EXPENSES
TOTAL (B)

3,53,000.00
7,45,931.00 Working capital required to meet the requirements of
staff and day to day working
3,00,000.00 Reserves kept aside for future purpose.

WORKING
3ytCAPITAL (c)
RESERVE AND
SURPLUS (D)
TOTAL (A+B+C+D)

24,00,000.00

BREAK UP OF INITIAL INVESTMENT

FURNITURE AND FIXUTERS

PARTICULARS
Office Sofa
Office Table

AMOUNT DESCRIPTION
4,900.00 1nos standard sofa set @Rs. 4,900
3,900.00 3 nos. of office tables @ Rs.1300 each

Racks

3,300.00 A set of 3 nos of Office Chair @ Rs.1100

Revolving chairs bought from Arrow
18,000.00 15 nos. of Wooden style racks @ Rs.1200

Chairs

2,400.00 3 nos. of multi purpose chairs @ Rs. 800

Table

1,900.00 2nos. general table to be kept in production

area @ Rs. 950 each
35,400.00

Office Chair

TOTAL

MACHINERY

PARTICULARS

AMOUNT DESCRIPTION
6,00,000.00 1 nos. Bio Degradable PE Corn Plastic Film
Blowing machine @ 6,00,000

Bio Degradable PE
Corn Plastic Film
Blowing Machine
Roll Making
Machine
Plastic Sheet Cutting
Machine
TOTAL

90,000.00 DZB500-800 Computer Control High Speed

Plastic Rolling Machine @ 90,000
4,050.00 2 nos. Fletcher Plastic Cutting Blade @2,025
each
6,94,050.00

MARKETING EXPENSES

PARTICULARS
PAMPHLETS

TAG LINE BELOW

THE BAGS
WEBSITE
TOTAL

AMOUNT DESCRIPTION
15,000.00 Pamphlets of our store will be distributed
outside the malls.
Distribution of 10,000 pamphlets @ 1.5Rs
45,000.00
The printing charges will incur for the
printing of tag line below the plastic bags.
20,000.00 A website will be created for contact
purpose
80,000.00

DEPRECITION DETAILS
YEAR 1
PARTICULARS
MACHINERY
FERMENTATION
TANK
FURNITURE AND
FIXTURES
AIR
CONDITIONERS
WATER PURIFER
COFFEE MACHINE
DESKTOP AND
PRINTERS
LIGHTS AND FANS
TELEPHONE AND
NET
CONNECTIONS
TOTAL

OPENING
RATE OF
DEPRECIATED CLOSING
VALUE
DEPRECIATION VALUE
VALUE
6,94,050.00
15
1,04,108.00
5,89,942.00
1,62,000.00
30
48,600.00
113,400.00
35,400.00

10

3,540

31,860.00

19,770.00

20

3,954.00

15,816.00

1,950.00
1,249.00
56,000.00

20
20
60

390.00
250.00
33,600.00

1,560.00
999.00
22,400.00

21,520.00
6,700.00

20
20

4,304.00
1,340.00

17,216.00
5,360.00

2,00,086

7,98,553

9,98,639

YEAR 2
PARTICULARS
MACHINERY
FERMENTATION
TANK
FURNITURE AND
FIXTURES
AIR
CONDITIONERS
WATER PURIFER
COFFEE MACHINE
DESKTOP AND
PRINTERS
LIGHTS AND FANS
TELEPHONE AND
NET
CONNECTIONS
TOTAL

OPENING
VALUE
5,89,942.00
113,400.00

RATE OF
DEPRECIATED CLOSING
DEPRECIATION VALUE
VALUE
15
88,491.00
5,01,451.00
30
34,020.00
79,380.00

31,860.00

10

3,186.00

28,674.00

15,816.00

20

3,163.00

12,653.00

1,560.00
999.00
22,400.00

20
20
60

312.00
200.00
13,440.00

1,248.00
799.00
8,960.00

17,216.00
5,360.00

20
20

3,443.00
1,072.00

13,773.00
4,288.00

1,47,327.00

6,51,226.00

7,98,553.00

YEAR 3
PARTICULARS
MACHINERY
FERMENTATION
TANK
FURNITURE AND
FIXTURES
AIR
CONDITIONERS
WATER PURIFER
COFFEE MACHINE
DESKTOP AND
PRINTERS
LIGHTS AND FANS
TELEPHONE AND
NET
CONNECTIONS
TOTAL

OPENING
VALUE
5,01,451.00
79,380.00

RATE OF
DEPRECIATED CLOSING
DEPRECIATION VALUE
VALUE
15
75,218.00
4,26,233.00
30
23,814.00
55,566.00

28,674.00

10

2,867.00

25,807.00

12,653.00

20

2,531.00

10,122.00

1,248.00
799.00
8,960.00

20
20
60

250.00
160.00
5,376.00

998.00
639.00
3,584.00

13,773.00
4,288.00

20
20

2,755.00
858.00

11,018.00
3,430.00

1,13,829.00

5,37,397.00

6,51,226.00

SALARY DETAILS
YEAR 1
POST

NUMBER
OF PEOPLE

SENIOR
MANAGER
ACCOUNTING
MANAGER
MARKETING
MANAGER
SALES MANAGER

SALARY PER
PERSON PER
MONTH
20,000

TOTAL
SALARY
PER MONTH
20,000

TOTAL
SALARY
PER YEAR
2,40,000

15,000

15,000

1,80,000

13,000

13,000

1,56,000

13,000

13,000

1,56,000

TECHNICIAN

12,000

24,000

2,88,000

LABOURERS

160

1,280

15,360

SECURITY GUARD

4,000

4,000

48,000

AWARENESS
PROGRAMMER
ACCOUNTANTS

4,500

4,500

54,000

10,000

20,000

2,40,000

CLERK

5,000

5,000

60,000

WAREHOUSE
INCHARGE
TOTAL

5,000

5,000

60,000

1,24,780.00

14,97,360.00

20

YEAR 2

POST

NUMBER
OF PEOPLE

SENIOR
MANAGER
ACCOUNTING
MANAGER
MARKETING
MANAGER
SALES MANAGER

SALARY PER
PERSON PER
MONTH
22,000

TOTAL
SALARY
PER MONTH
22,000

TOTAL
SALARY
PER YEAR
2,64,000

16,500

16,500

1,98,000

14,300

14,300

1,71,600

14,300

14,300

1,71,600

TECHNICIAN

13,200

26,400

3,16,800

LABOURERS

176

1,408

16,896

SECURITY GUARD

4,400

4,400

52,800

AWARENESS
PROGRAMMER
ACCOUNTANTS

4,950

4,950

59,400

11,000

22,000

2,64,000

CLERK

5,500

5,500

66,000

WAREHOUSE
INCHARGE
TOTAL

5,500

5,500

66,000

1,37,258.00

16,47,096.00

20

YEAR 3

POST

NUMBER
OF PEOPLE

SENIOR
MANAGER
ACCOUNTING
MANAGER
MARKETING
MANAGER
SALES MANAGER

SALARY PER
PERSON PER
MONTH
24,200

TOTAL
SALARY
PER MONTH
24,200

TOTAL
SALARY
PER YEAR
2,90,400

18,150

18,150

2,17,800

15,730

15,730

1,88,760

15,730

15,730

1,88,760

TECHNICIAN

14,520

29,040

3,48,480

LABOURERS

194

1,152

13,824

SECURITY GUARD

4,840

4,840

58,080

AWARENESS
PROGRAMMER
ACCOUNTANTS

5,445

5,445

65,340

12,100

24,200

2,90,400

CLERK

6,050

6,050

72,600

WAREHOUSE
INCHARGE
TOTAL

6,050

6,050

72,600

1,50,587.00

18,07,044.00

20

REVENUE MODEL

Our revenues are generated from products of different sizes and thickness.
Thickness- 40 microns
Sizes
Price/ piece of
bag (in Rs.)
Quantity sold per
day
Total revenue
generated (per
day)
Total revenue
generated (per
month)

8*12 inches
.45

12*15 inches
.75

17*21 inches
.90

3000

4000

2000

.45*3000
= Rs. 1,350

.75*4000
=Rs. 3,000

.90*2000
=Rs. 1,800

1350*26
=Rs. 35,100

3000*26
=Rs. 78,000

1,800*26
=Rs. 46,800

Total of revenue generated from all the sizes of corn bags (per month)
= 35,100+ 78,000 + 46,800
=Rs. 1,59,900
Hence, total revenue generated in a year
=1,59,900*12
=19,18,800

Thickness- 60 microns
Sizes
Price/ piece of
bag (in Rs.)
Quantity sold per
day
Total revenue
generated (per
day)
Total revenue
generated (per
month)

8*12 inches
.70

12*15 inches
.90

17*21 inches
1.2

1500

2500

800

.70*1500
=Rs. 1050

.90*2500
=Rs. 2250

1.2*800
=Rs. 960

1050*26
=Rs. 27,300

2250*26
=Rs. 58,500

960*26
=Rs. 24,960

Total of revenue generated from all the sizes of corn bags (per month)
= 27,300 + 58,500 + 24,960
=Rs. 1,10,760
Hence, total revenue generated in a year
=1,10,760*12
=Rs. 13,29,120

Now we calculate the total revenue earned in a year from plastic bags of different
thickness
= 13,29,120 + 19,18,800
= Rs.32,47,920

INCOME AND EXPENDITURE ACCOUNT

PARTICULARS
REVENUE AND INCOME
Revenue from sales
TOTAL REVENUE (A)

SCHEDULES

YEAR 1

YEAR 2

YEAR 3

32,47,920.00
32,47,920.00

42,22,296.00 54,88,985.00
42,22,296.00 54,88,985.00

B
C

14,97,360.00
5,04,000.00
24,000.00

16,47,096.00 18,07,044.00
5,54,400.00 6,09,840.00
24,000.00
24,000.00

8,000.00
35,000.00
56,000.00
8,300.00
26,000.00
1,17,667.00

10,000.00
35,000.00
61,600.00
9130.00
26,780.00
1,17,667.00

12,000.00
35,000.00
67,760.00
10,043.00
27,583.00
1,17,667.00

2,00,000

2,20,000

2,42,000

95,000.00

1,23,500.00

1,60,550.00

25,71,327
6,76,593

28,29,173
13,93,123

31,13,487
23,75,498

LESS: EXPENSES
Administrative expenses
Salaries
Rent
Repairs & Maintenance
Expenses of machinery
Office Stationary and Printing
Warehouse Maintanace
Electricity Bill
Water
Insurance
Writing-off Start Up Expenses
Raw material
Corn
Selling Expenses
Advertising expenses
Total EXPENSES(B)
TOTAL OPERATING
PROFIT/LOSS(A-B)
Less:Depriciation
NET PROFIT/LOSS
BEFORE INTEREST AND
TAX
LESS: Interest on loans(15%)
PROFIT BEFORE TAX
LESS: TAX(30%)
Net Profit/Loss after paying

NIL

2,00,086
4,76,507.00

1,47,327
1,17,829
12,45,796.00 23,57,669.00

1,50,000.00
3,26,507.00

1,50,000.00 1,50,000.00
10,95,796.00 22,07,660.00
3,28,739
6,62,298

3,26,507.00 7,67,057.00

15,45,362.00

tax
and interest
4,40,550.00

Profit/Loss from last year

NET PROFIT/LOSS OF THIS
YEAR

3,26,507.00

7,78,305.00

12,07,607.00 23,23,667.00

CASH FLOW STATEMENT

PARTICULARS

YEAR 1

YEAR 2

YEAR 3

Cash Received
Cash from operations:
Cash Sales
Cash from Receivables
Subtotal Cash from Operations

32,47,920.00 42,22,296.00 54,88,985.00

Additional Cash Received

Amount taken as Unsecured Loan
Capital contribution from the
promoters

10,00,000.00
14,00,000.00

Subtotal Cash Received

56,47,920.00 42,22,296.00 54,88,985.00

32,47,920.00 42,22,296.00 54,88,985.00

Expenditures
Expenditures from Opearations
Cash Spending
Payment of Interest
Payment of tax
Subtotal spent on Operations

24,53,660.00 27,11,506.00 29,95,820.00

1,50,000.00
1,50,000.00 1,50,000.00
NIL
3,28,739
6,62,298
26,03,660.00 31,90,245.00 38,08,118.00

Start-up expenses
Subtotal Cash Spent

1,17,667.00
1,17667.00 1,17,667.00
27,21,327.00 33,07,912.00 39,25,785.00

Net Cash Flow

Previous year's Cash b/d
Cash Balance

29,26,593.00

9,14,384.00 15,63,200.00
29,26,593.00 38,40,977.00
29,26,593.00 38,40,977.00 54,04,177.00

BALANCE SHEET

PARTICULARS
ASSETS
Current Assets
Cash
other current asset
Total current assets

YEAR 1

YEAR 2

YEAR 3

19,24,954.00

28,09,054.00

41,86,270.00

19,24,954.00

28,09,054.00

41,86,270.00

9,98,639.00
2,00,086

7,98,553.00
1,47,327

6,51,226.00
1,13,829

7,98,553.00

6,51,226.00

5,37,397.00

TOTAL ASSETS

27,26,507.00

36,07,607.00

47,23,667.00

LIABILITIES
Current Liabilities
Unsecured Loan

10,00,000.00

10,00,000.00

10,00,000.00

Long-term Liabilities
Capital
Add: Net Profit
Total Capital

14,00,000.00
3,26,507.00
17,26,507.00

14,00,000.00
12,07,607.00
26,07,607.00

14,00,000.00
23,23,667.00
37,23,667.00

TOTAL LIABILITIES

27,26,507.00

36,07,607.00

47,23,667.00

Fixed Assets
Less: Accumulated
Depreciation
Total fixed assets

BREAK EVEN ANALYSIS

BREAK EVEN ANALYSIS

Break Even Sales= Fixed Cost / PV Ratio

PV Ratio = Contribution / Sales

Particulars

Amount

Sales
Variable Cost
Contribution
Fixed Cost
Price Volume Ratio
Break Even Sales
Time required to break even (in years)

The firm breaks even after

32,47,920.00
6,26,386.00
26,21,534.00
21,51,360.00
80.71
26,655.43