PART A The following information summarizes the Food and Beverage Department account of the Tourism Hotel for the year ended December 31, 2017. Prepare the Food and Beverage Departmental Statement for Tourism Hotel. Food Sales 580,000 Beverage Sales 195,000 Cost of Food used 152,000 employee meals 12,000 Cost of Beverage used 100,000 Salaries and Wages 196,000 Employee Benefits 11,300 China, Glassware and Silver 5,000 Kitchen Fuel 1,500 Laundry 3,400 Music and Entertainment 15,000 Uniforms 1,900 Other Operating Expenses 4,000 Licenses 1,250
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
PART A
The following information summarizes the Food and Beverage Department account of the Tourism Hotel for the year ended December 31, 2017. Prepare the Food and Beverage Departmental Statement for Tourism Hotel.
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Food Sales |
580,000 |
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Beverage Sales |
195,000 |
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Cost of Food used |
152,000 |
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employee meals |
12,000 |
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Cost of Beverage used |
100,000 |
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Salaries and Wages |
196,000 |
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Employee Benefits |
11,300 |
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China, Glassware and Silver |
5,000 |
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Kitchen Fuel |
1,500 |
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Laundry |
3,400 |
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Music and Entertainment |
15,000 |
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Uniforms |
1,900 |
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Other Operating Expenses |
4,000 |
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Licenses |
1,250 |
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PART B
Use your findings for Food and Beverage Department of the Tourism Hotel from Part A, and the following Income Statement information below to prepare an Income Statement for the Tourism Hotel for the year ended December 31, 2017.
Rooms Department 420,000
Telephone (loss) (10,000)
Rentals 22,000
Other Operated Departments30,000
Administrative and General35,000
Property Operations and Maintenance90,000
Marketing55,000
Energy Costs40,000
Human Resources Department30,000
Property Taxes20,000
Insurance 5,500
Interest 7,500
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