G Homes Inc. has decided to develop two housing projects with the following assumptions:

A.Socialized Housing Project

The developer is developing socialized housing units with 47 units of them as one storey houses and another 48 units of 2-storey houses. The one storey housing is 37 sqm per unit with floor area of 24 sqm. The two-storey socialized housing is 48 sqm per unit with floor area of 47 sqm.The cost in the site development include embankment, perimeter fence, road network , drainage, electrical and water utilities is 6,000,000. The one storey, the building construction is with cost of PhP 288,000 per unit house, totalling Php 13,536,000.00 expected building construction cost . The two -storey socialized housing is with building construction cost of PhP 936,000.00 per unit with total expected building construction cost of Php 44,928,000.00. For the subdivision the total cost for this project will be Php 64,464,000.00. Gross margin is 25%.

Revenue projections:

For the socialized housing(one storey), on the first year, 9 units were sold, on the second year 9 units, on the 3rd year 9 units, and 10 units on the 4rth and 5th year. For the socialized housing(two storey), on the first year, 9 units were sold, on the second year 10 units, on the 3rd year 9 units, and 10 units on the 4rth and 5th year. Units are delivered on the year it is sold.

B. Open Market Housing Project

Selling price per unit:

Single Detached Php 4,500,000/unit

Row House Php 3,000,000/unit

The developer is developing 24 units of Single Detached units and 57 units of Row Houses. The single detached housing is 125sqm per unit with floor area of 96 sqm. The row house is 78 sqm per unit with floor area of 96 sqm.The cost in the site development which include embankment, perimeter fence, road network , drainage, electrical and water utilities is 14,000,000. Single Detached building and construction is a 2-storey building with building construction cost of PhP 3,125,000.00 per unit house totalling Php 75,000,000.00 expected building construction cost. Row house building is a 2 storey unit with building construction cost of PhP 1,920,000.00 with total expected building construction cost of Php 109,440,000.00. For the subdivision the total cost for this project will be Php 198,440,00,000.00.

Revenue projections:

For the Single Detached housing, on the first year, 4 units were sold, on the second year 5 units, on the 3rd year 5 units, and 5 units on the 4rth and 5th year. For the Row housing, on the first year, 11 units were sold, on the second year 11 units, on the 3rd year 11 units, and 12 units on the 4rth and 5th year. Units are delivered on the year it is sold.

Marketing expenses is equal to 5% of sales.

Business processing and legal requirements fee is Php 500,000.

VAT is 12%.

All cost are from vatable suppliers and contractors.

Salaries and Wages is 4% of sales for both projects.

Yearly corporate tax rate is based on 2021 train law.

The company starts it's operation and development from 2021-2025, on a calendar year basis.

The developer has no intention of borrowing from banks as they believe that collections are enough in the development process.

Requirements:

1. Prepare the projected financial statements of each project assuming they will not be purchasing any equipment as they will be getting subcontractors for the development :

1.1 Revenue projection, Balance Sheet, Profit and Loss Statement, Cash Flow Statement for 5 years assuming units are 100% fully paid by the customer on the year purchased.

1.2 Revenue projection, Balance Sheet, Profit and Loss Statement, Cash Flow Statement for 5 years assuming units are 20% are paid by the customer on the year purchased, 80% is amortized for 5 years with 8% interest rate.

1.3 Revenue projection, Balance Sheet, Profit and Loss Statement, Cash Flow Statement for 5 years assuming 50% of the units are fully paid by the customer on the year purchased, the rest of the 50% of the units are 20% paid by the customer on the year purchased, 80% is amortized for 5 years with 8% interest rate.

2. Compute the G Homes Inc.'s margin, turnover, and ROI for each project, and for the company.

3. Should the developer would make a decision to concentrate on one project which project will give them better numbers. Support your answer.

4. Compute the annual net cash inflow from the project assuming 12% company's discount rate.

5. Compute the project's net present value.Is this project acceptable?

6. Find the project's internal rate of return to the nearest whole percent.

7. Compute the projects' payback period.

8. Compute the project's simple rate of return.

9. Using the indirect method, determine the net cash provided by operating activities for 2021,2022,2023,2024 and 2025.

10. Construct a statement of Cash flows for 2021, 2022, 2023,2024, and 2025 to complement Balance and Profit Loss Statement.

11.Compute the return on total assets.

12. Compute on the return on equity.

13. Is G Homes Inc.'s financial leverage positive or negative? Explain.

14. Compute the current ratio.

15. Compute the acid-test ratio.

16. Compute the inventory turnover.

17. Compute the average sale period.

18. Compute the debt-to-equity ratio.

19. Compute the total asset turnover.

20. Compute the net profit margin percentage.