Functions of Management -PLANNING Make: Title of the Case,Summary of the Case ( 3 pages) , Problems Encountered ( minimum of 3 problems) , Solution(s)
Functions of Management -PLANNING
Make: Title of the Case,Summary of the Case ( 3 pages) , Problems Encountered ( minimum of 3 problems) , Solution(s) of the Case
(the pics is just 1 case)
On November 30, 1988, Mr. Roy Roxas, Project Manager of the Metropolitan Housing Project Company (MHPC) was preparing a three Year Plan for the period (1989-1991) for presentation to the Board on December 31,1988. The MHPC was formed in 1982 to develop real estate properties for sale to the public. The first project undertaken by the company is the development of a real estate property located in Laguna called Lagunaville. The site is near the University of the Philippines campus in College, Laguna. Below is the draft of the plan that Roy Roxas prepared. Metropolitan Housing Project Company Lagunaville Three-Year Plan 198991 When I was appointed Project Manager of Lagunaville in March 1987, the cash balance of the company was merely P110,755. Its liabilities, on the other hand, amounted to P13.75 Million. During the next 3 years my objectives for Lagunaville are the following: 1) to settle all the liabilities relative to the project, 2) to increase the cash balance to P2.348M, (See Exhibit A). 3) to complete site development and, 4) to sell all residential lots. The above objectives could be accomplished with the following assumptions: METROPOLTTAN HOUSING PROJECT COMPANY 167 1) the purchasing power of the salaries of government Exhibit A employees is maintained at present level, PROJECTED CASH FLOW 2) the Home Development Mutual Fund will take out (December 1, 1988 to December 1991) some of our credit sales, 3) - the availability of interim financing facility and, 4) the completion of the highway road leading to the site of Lagunaville. The success of the project will depend on total cash inflows of P20.7M, which will be generated during the next 3 years from the collection of installment sales and from the sale of new lots. The projected net cash inflow after 3 years of P2.348M does not include the cash proceeds which could be generated from the sale of two parcels of commercial lots with a total area of 12,232.00sq.m. The appraised value of these lots is P450/sq.m. or P5,504,400.00. UESTIONS: As a member of the Board, evaluate the 3-year plan prepared by Mr. Roy Roxas. What additional reports will you request Mr. Roxas to prepare in order to enable you to evaluate the feasibility of the 3-year plan. If site development costs increase by 30% starting 1989 (and assuming no changes in the selling prices of lots), will the company Notes to Projected Cash Flow METROPOUTAN HOUSING PROJECT COMPANY 'Down payment on new Sales includes the following: Exhibit B SITE DEVELOPMENT COSTS a) 103 lots in inventory with total area of 38,642.80sq.m. at P260/ q.m.; ( P10,047,128 20%=P2,009,425.60);P97,344.93/ month, first 20 months; P58,526.96/month starting 21st month. b) 36 lots sold to company's employees with total area of 8,556.20sqm. =P2,224.612.00 expected to be sold in February 1989. 2 Schedule of Collections Sold lots a) Company Loan Assistance Program (through salary deduction). December 1988 -December 1989 P 16,000/monthP208,000 January 1990 - December 1990P20,000/ month 240,000 January 1991 - December 1991P24,000/ month 288,000 P736,000.00 b) Pag-ibig Loan Take-Out Proceeds for 180 lots 6,800.000 P 600,000, March 1989 P 200,000, August 1989 P 600,000, June 1989 P1,000,000, December 1989 P1,200,000 Yr. 1990 P3,200,000 Yr. 1991 c) Other collections - P45,210.67/month From December 1988 to June 1991 1,401,530.77 New Sales a) Monthly amortization on 103 lots in inventory (See la) up to end of 3rd quarter of 1990 , estimated date of Pag-ibig loan take-out 2,063,952.52 b) Pag-ibig lot financing for 100 lots- in 1990 50 lots and in 1991,50 lots Total P16,539.483.29 3 Principal and interest payments due in 1989P2,654,813.02 Exhibit B SITE DEVELOPMENT COSTS (December 1, 1988 to December 1991) On November 30, 1988, Mr. Roy Roxas, Project Manager of the Metropolitan Housing Project Company (MHPC) was preparing a three Year Plan for the period (1989-1991) for presentation to the Board on December 31,1988. The MHPC was formed in 1982 to develop real estate properties for sale to the public. The first project undertaken by the company is the development of a real estate property located in Laguna called Lagunaville. The site is near the University of the Philippines campus in College, Laguna. Below is the draft of the plan that Roy Roxas prepared. Metropolitan Housing Project Company Lagunaville Three-Year Plan 198991 When I was appointed Project Manager of Lagunaville in March 1987, the cash balance of the company was merely P110,755. Its liabilities, on the other hand, amounted to P13.75 Million. During the next 3 years my objectives for Lagunaville are the following: 1) to settle all the liabilities relative to the project, 2) to increase the cash balance to P2.348M, (See Exhibit A). 3) to complete site development and, 4) to sell all residential lots. The above objectives could be accomplished with the following assumptions: METROPOLTTAN HOUSING PROJECT COMPANY 167 1) the purchasing power of the salaries of government Exhibit A employees is maintained at present level, PROJECTED CASH FLOW 2) the Home Development Mutual Fund will take out (December 1, 1988 to December 1991) some of our credit sales, 3) - the availability of interim financing facility and, 4) the completion of the highway road leading to the site of Lagunaville. The success of the project will depend on total cash inflows of P20.7M, which will be generated during the next 3 years from the collection of installment sales and from the sale of new lots. The projected net cash inflow after 3 years of P2.348M does not include the cash proceeds which could be generated from the sale of two parcels of commercial lots with a total area of 12,232.00sq.m. The appraised value of these lots is P450/sq.m. or P5,504,400.00. UESTIONS: As a member of the Board, evaluate the 3-year plan prepared by Mr. Roy Roxas. What additional reports will you request Mr. Roxas to prepare in order to enable you to evaluate the feasibility of the 3-year plan. If site development costs increase by 30% starting 1989 (and assuming no changes in the selling prices of lots), will the company Notes to Projected Cash Flow METROPOUTAN HOUSING PROJECT COMPANY 'Down payment on new Sales includes the following: Exhibit B SITE DEVELOPMENT COSTS a) 103 lots in inventory with total area of 38,642.80sq.m. at P260/ q.m.; ( P10,047,128 20%=P2,009,425.60);P97,344.93/ month, first 20 months; P58,526.96/month starting 21st month. b) 36 lots sold to company's employees with total area of 8,556.20sqm. =P2,224.612.00 expected to be sold in February 1989. 2 Schedule of Collections Sold lots a) Company Loan Assistance Program (through salary deduction). December 1988 -December 1989 P 16,000/monthP208,000 January 1990 - December 1990P20,000/ month 240,000 January 1991 - December 1991P24,000/ month 288,000 P736,000.00 b) Pag-ibig Loan Take-Out Proceeds for 180 lots 6,800.000 P 600,000, March 1989 P 200,000, August 1989 P 600,000, June 1989 P1,000,000, December 1989 P1,200,000 Yr. 1990 P3,200,000 Yr. 1991 c) Other collections - P45,210.67/month From December 1988 to June 1991 1,401,530.77 New Sales a) Monthly amortization on 103 lots in inventory (See la) up to end of 3rd quarter of 1990 , estimated date of Pag-ibig loan take-out 2,063,952.52 b) Pag-ibig lot financing for 100 lots- in 1990 50 lots and in 1991,50 lots Total P16,539.483.29 3 Principal and interest payments due in 1989P2,654,813.02 Exhibit B SITE DEVELOPMENT COSTS (December 1, 1988 to December 1991)
