6.

1 Start-Up Cost
The start-up cost is an initial investment into the business that might be includes one-
time start-up costs such as research and development cost, incorporation costs, rental
and utilities deposits, fixtures and equipment, and renovation. Besides that, it also can
be determine as an initial working capital such inventory, rent, utility, advertising and
office supplies)

Total start-up cost = RM37122

6.2 Working Capital
The initial working capital is required at the time to starts of business. These are the
promotion expenses incurred at the earliest stage of formation of the company which is
including the incorporation fees such office expenses, attorneys fees and other
preliminary expenses.
6.3 Start-Up Capital and Financial

The external sources of finance are important that derived from commercial banks,
institutes of finance and government agencies which come in the form of term loans,
hire purchase and grants.

The total amount of funds that have been sourced should be equal or higher than the
total project implementation that been calculated before. This effective way is important in
order to ensure that the project is fully funded and to avoid the risks under financing laws.

Capital Expenditure Cost (RM) Sources of Financing

 Land and Building 0 -

Office Furniture and 1,972 Cash

Equipment

Office Renovation 50 Cash

Transportation 1,000 Hire-purchase

Advertising 200 Cash

Machinery 600 Loan

Working Capital for 3 months

Sales & Marketing Costs 3,600 Loan

General & Administrative 42,051 Loan

Cost

Operations & Technical 295,500 Loan

Costs

Pre-operating & 4,500 Cash

Incorporation Costs (one-off)

Total 397,187

6.4 Cash Flow Statement

Pro forma cash flow statement is the projected statement of cash inflow and outflow
through the planning duration. Under the normal implementation, the pro forma cash
flow statement is prepare for the next three or five consecutive years. However, when
taking a longer period estimation, sometimes it needs depending upon the project
undertaken.
6.5 Income Statement
The income statement shows the expected profit or loss for the planned period.
Usually the pro forma income statement consists of sales, gross income and net income
before tax.
6.5 Balance Sheet

The pro forma balance sheet shows the financial performance of the business for the
planned period and the financial position of the business at a specific point in time in terms of
assets owned and how those assets are financed.

Assets are the economic resources of a business that are expected to be of benefit in
the future. Owners equity refers to capital contributions from the owners or shareholders in
terms of cash or assets plus the accumulated amount of net income. However, if the business
suffers a loss, the amount of loss will be deducted from the capital contributions.

Liabilities are the amounts owed by the business to outsiders. Current liabilities refer
to the short-term obligations of the business that mature within a period of less than a year.
The most common forms of current liabilities are accounts payable and accrued payments