Analyzing an Income Cash Flow Statement Ouz Benice
Analyzing an Income & Cash Flow Statement Oğuz Benice Bilkent University School of Tourism & Hotel Management
ANALYZING AN INCOME & CASH FLOW STATEMENT Definition To control cost, managers need to be able to calculate the net profit, or loss. The Income & cash flow statement is the financial document showing a company's income, expenses and cash balance over a given period.
Food Sales Include revenue from food, coffee, tea, milk, juices and other nonalcoholic items typically part of a meal. If there is no alcoholic beverage service, soft drinks would also be included in this category.
Beverage Sales includes wine, liquor, beer and soft drinks.
Food Cost includes food, coffee, tea, milk and soft drink expenses associated with the service of meals. (generally between 25% & 35% of food sales).
Beverage Cost includes beverage expenditures associated with the sale of all wines, liquors and beers. (generally between 15% & 25% of beverage sales).
Other Income includes cover charges, banquet room rental, sundry sales, vending sales, telephone commissions, salvage sales and other miscellaneous revenue items.
Employee Wages Employee wages includes all positions including categories such as, host, server bus person, cook, dishwasher, storeroom clerk and bartender’s wages except restaurant managers.
Management Salaries Management salaries includes restaurant manager’ salary.
Employee Benefits include social security taxes, unemployment taxes and state health insurance tax. It also includes insurance (such as worker's compensation and health coverage), employee meals and other benefits.
Direct Operating Expense includes uniforms, laundry, tableware and linen, utensils, kitchen fuel, supplies, menus, contract cleaning, flowers and decorations, auto expense, licenses and permits and other expenses.
Music & Entertainment Music and Entertainment Expense includes musicians, entertainers, royalties and other costs. In a dining situation, the entertainment should complement the overall atmosphere. In some type of facilities, the entertainment may be a major reason why people come in. The cost of entertainment must produce a revenue increase greater than the cost. (see graph)
Marketing Expense includes selling and promotion costs, advertising, public relations, franchise fees and other expenses incurred to make the public aware of the restaurant. (should be around 3% from total F&B sales, and 6% for the first year).
Utilities Expense includes electricity, gas, water and sewer services. It excludes fuel used to operate the kitchen.
Repairs & Maintenance Repairs and Maintenance Expense includes supplies, materials and contracted work associated with maintaining the building and grounds.
Administrative Expense includes overhead items required to run the business, but not directly related to the service of the customer. Items included are office supplies, postage, computers and software, telephone, travel, general insurance, credit card commissions, collection fees, cash shortages, and other administrative costs.
Rent is the amount paid for the use of a premises. (should not exceed 5% to 8% of total F&B sales).
Interest Expense is the periodic charge for the use of funds loaned by a bank or other lender.
KDV is the Turkish Tax based on total food & beverage sales plus other income.
Refund is the periodic back payment of funds loaned by a bank or other lender.
Exercise A 1
Exercise A 1 (& result)
Exercise A 1 (& result)
Exercise A 2
Exercise A 2 (& result)
Exercise A 2 (& result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Break-even Point To control cost, managers need to be able to calculate the breakeven point. The simple definition of a breakeven point is the volume of sales or guest needed daily for a business to generate zero profit. Formula:
Exercise A 1 (& result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Break-even Point Calculate the breakeven for the exercice A 2
Exercise A 2 (& result)
Exercise A 3
Exercise A 4
ANALYZING AN INCOME & CASH FLOW STATEMENT Forecasting Yearly Sales
ANALYZING AN INCOME & CASH FLOW STATEMENT Forecasting Monthly Sales
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise D 1
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise D 1 (result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise E 1
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise E 1 (result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise D 2
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise D 2 (result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise E 2
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise E 2 (result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise F 2
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise F 2 (result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise F 2 (result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise F 2 (result)
ANALYZING AN INCOME & CASH FLOW STATEMENT Exercise E 1 The cost of entertainment must produce a revenue increase greater than the cost. Consider the following sample:
ANALYZING AN INCOME & CASH FLOW STATEMENT Mid Term 2005 Spring - A
ANALYZING AN INCOME & CASH FLOW STATEMENT Mid Term 2005 Spring - B
ANALYZING AN INCOME & CASH FLOW STATEMENT Mid Term 2005 Spring - C
ANALYZING AN INCOME & CASH FLOW STATEMENT Mid Term 2005 Spring - D
Mid Term 2005 Spring – A
Mid Term 2005 Spring – B
Mid Term 2005 Spring – C
Mid Term 2005 Spring – D
- Slides: 55