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Create budget assumption

Create budget assumption

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Create budget assumption
O Search Budget Finals Sp21 (1) - Protected View - AutoSave O ff Insert Page Layout Formulas Data Review View Help File Home Draw Enable Editing O PROTECTED VIEW Be careful-files from the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View. A25 Miscellaneous Chix and Waffles Month Ending May, 2021 Month Ending June, 2021 Month Ending July, 2021 1 Month Ending February 29, 2020 s Sales Revenue FIDI 88,000 85% Special Events 15,000 15% Total Sales Revenue 103,000 100% * Cost of Sales * Cost of Sales, Food 41,200 40% Less: Employee Meals 240 0% 12 Net cost of sales, food 40,960 40% Total Net Cost of Sales 40,960 E Gross Margin (Profit) 62,040 60% - Departmental Operating Expenses Salaries and wages 11,910 12% Employee benefits 3,658 4% Total payroll related expenses 15,568 15% 28 Paper Supplies, Disposables 11,000 24 11% Cleaning supplies 1,030 1% Laundry 264 0% 23 Licenses 85 0% Miscellaneous 100 0% s Total Operating Expenses 28,047 27% 7 Net Income (Loss) 33,993 33% Sheet1 Sheet2 Sheet3 Ready P Type here to search W
Transcribed Image Text:O Search Budget Finals Sp21 (1) - Protected View - AutoSave O ff Insert Page Layout Formulas Data Review View Help File Home Draw Enable Editing O PROTECTED VIEW Be careful-files from the Internet can contain viruses. Unless you need to edit, it's safer to stay in Protected View. A25 Miscellaneous Chix and Waffles Month Ending May, 2021 Month Ending June, 2021 Month Ending July, 2021 1 Month Ending February 29, 2020 s Sales Revenue FIDI 88,000 85% Special Events 15,000 15% Total Sales Revenue 103,000 100% * Cost of Sales * Cost of Sales, Food 41,200 40% Less: Employee Meals 240 0% 12 Net cost of sales, food 40,960 40% Total Net Cost of Sales 40,960 E Gross Margin (Profit) 62,040 60% - Departmental Operating Expenses Salaries and wages 11,910 12% Employee benefits 3,658 4% Total payroll related expenses 15,568 15% 28 Paper Supplies, Disposables 11,000 24 11% Cleaning supplies 1,030 1% Laundry 264 0% 23 Licenses 85 0% Miscellaneous 100 0% s Total Operating Expenses 28,047 27% 7 Net Income (Loss) 33,993 33% Sheet1 Sheet2 Sheet3 Ready P Type here to search W
n viruses. Unless you need to edit, it's safer to stay in Protected View. Enable Editing Premise: After a stellar February performance, your Chix and Waffles food truck sat in the garage for the duration of the lockdown. You will slowly re-start your business on May 16 and plan on increasing volume by June and July but still not at February levels. $8/plate. You operated the truck on In February, you did 550 covers/day at an average weekdays at a FIDI location (5 days/wk) and did special events one day per weekend, 250 covers each at $15/plate. Assumptions: 1. For the second half of May, only 1/3 of the February daily covers will be achievable. No special events are anticipated. 2. The operation had 4 employees: Chef/Owner at an annual salary of $45,000 (that's you), 3 cooks/assistants at $17/hr and 40 hrs/wk 3. In May, only you, the chef and an assistant will re-start. Another cook will be added in June and by July, you will be staffed at pre-pandemic levels. 4. The truck is fully depreciated. 5. Food cost is anticipated to be at 45% in May and 42% for the months of June and July. This is attributed to the Increase in prices across the board. 6. Special events will be resumed in July. 7. Conservative forecast for May sales is 1/3 of February daily covers. June sales will be at 75% of February. July daily sales will be at February levels. 8. Paper supplies/disposables are budgeted at $1/cover. 9. Cleaning supplies may rise .5% due to more stringent sanitizing protocols. 10. Laundry is pegged at $2.75/day per employee. 11. Employee benefits are at 24% of salaries and wages + $140/mo per employee for Health Insurance and employee meals at $2.50 a day per employee. 12. Licenses and Miscellaneous Expenses are fixed. D Focus 立
Transcribed Image Text:n viruses. Unless you need to edit, it's safer to stay in Protected View. Enable Editing Premise: After a stellar February performance, your Chix and Waffles food truck sat in the garage for the duration of the lockdown. You will slowly re-start your business on May 16 and plan on increasing volume by June and July but still not at February levels. $8/plate. You operated the truck on In February, you did 550 covers/day at an average weekdays at a FIDI location (5 days/wk) and did special events one day per weekend, 250 covers each at $15/plate. Assumptions: 1. For the second half of May, only 1/3 of the February daily covers will be achievable. No special events are anticipated. 2. The operation had 4 employees: Chef/Owner at an annual salary of $45,000 (that's you), 3 cooks/assistants at $17/hr and 40 hrs/wk 3. In May, only you, the chef and an assistant will re-start. Another cook will be added in June and by July, you will be staffed at pre-pandemic levels. 4. The truck is fully depreciated. 5. Food cost is anticipated to be at 45% in May and 42% for the months of June and July. This is attributed to the Increase in prices across the board. 6. Special events will be resumed in July. 7. Conservative forecast for May sales is 1/3 of February daily covers. June sales will be at 75% of February. July daily sales will be at February levels. 8. Paper supplies/disposables are budgeted at $1/cover. 9. Cleaning supplies may rise .5% due to more stringent sanitizing protocols. 10. Laundry is pegged at $2.75/day per employee. 11. Employee benefits are at 24% of salaries and wages + $140/mo per employee for Health Insurance and employee meals at $2.50 a day per employee. 12. Licenses and Miscellaneous Expenses are fixed. D Focus 立
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