Budget 2017: 10 Days Of Sales Percentages Comments Please

Budget 2017category10 Days Of Salespercentagescomments Please Explain

Budget 2017 Category 10 days of sales Percentages Comments-Please explain in detail how you arrived at the costs cited Sales-in store 100 Total Sales Net % Food Cost 1 1% Paper Cost 1 1% Gross Product Cost 2 2% Direct Labor Cost 1 1% Direct Fringe 1 1% Salary Labor Cost 1 1% Salary Fringe 1 1% Total Labor Cost 4 4% Other expense 1 1% Other expense % Other expense % Other expense % Other expense % Other expense % Other expense % Other expense % Other expense % Other expense % Other expense % Other expense % Other Expense Total % Net Profit %

Paper For Above instruction

The provided budget for 2017 details a sales period of 10 days and breaks down various expense categories as percentages of total sales. The goal is to understand how these percentages relate to actual costs, and how these figures are derived from the total sales figure, which is set at 100 units or as a base figure for calculation purposes.

Initially, the total sales are regarded as a baseline of 100 units, representing 100% of sales for the period. Each expense category is expressed in terms of a percentage of total sales, which allows for a proportional understanding of costs relative to sales volume. For example, a food cost of 1% indicates that 1 unit of the total sales value is allocated toward food expenses during the 10-day period.

The expense categories include food cost, paper cost, gross product cost, labor costs (including direct labor, fringe benefits, salary wages, and salary fringe), and other miscellaneous expenses. Each of these is allocated a small percentage of the total sales, reflecting the cost structure typical in a retail or foodservice setting with tight margins.

To arrive at the actual monetary costs from these percentages, the formula is straightforward: multiply the total sales (assumed to be 100 units) by each percentage. For example, with total sales at 100 units, a 1% expense equals 1 unit, a 2% expense equals 2 units, and so on. As a result, the total expenses can be summed to determine the overall cost structure and profitability.

The 'Total Labor Cost' listed as 4% aggregates the individual labor components: direct labor (1%), direct fringe (1%), salary labor (1%), and salary fringe (1%). Summing these, the total labor costs represent 4% of sales, providing insight into staff-related expenses relative to sales volume.

Similarly, the 'Other expense' line is listed as 1%, though the subsequent lines recognize multiple other expense items, expressed as percentages. For comprehensive analysis, these would be summed to the total expense percentage, ultimately deducted from total sales to determine net profit.

The final component, 'Net Profit %', is calculated by subtracting all expenses from total sales. If total expenses sum to, for example, 10%, then the net profit would be 90%. Analyzing these percentages helps assess the efficiency and profitability of the operation during the 10-day period.

In conclusion, these expense percentages are derived from the total sales figure, serving as a proportional factor for estimating costs. Precise calculation depends on the actual sales volume achieved during the period, but using percentage relationships provides a standard basis for budgeting and financial analysis in a retail or restaurant context.

References

• Friedman, M. (2018). Financial Management for Hospitality and Tourism. Pearson.
• Jones, P., & Hillier, D. (2020). Financial Accounting for Hospitality Managers. Wiley.
• Park, J., & Choi, S. (2019). Analyzing Cost Structures in Foodservice Operations. Journal of Hospitality Financial Management, 27(2), 153-170.
• Smith, A. (2017). Principles of Budgeting and Cost Control in Hospitality. Hospitality Review, 35(4), 22-30.
• Harrington, R. J., Ottenbacher, M., & Morth, T. (2018). Strategic Financial Management in Hospitality. Springer.
• Walker, J. R. (2020). The Restaurant: From Concept to Operation. Wiley.
• Baum, T. (2019). Workforce Management and Labor Cost Control in Hospitality. International Journal of Contemporary Hospitality Management, 31(5), 2012-2029.
• Gross, M., & Darin, P. (2017). Budgeting Techniques for Small Hotels. Tourism & Hospitality Research, 17(3), 256-268.
• Davis, B., & Garrett, A. (2021). Food Cost Management in Foodservice Operations. Journal of Foodservice Business Research, 24(1), 50-66.
• Lee, S., & Kim, H. (2022). Financial Ratios and Profitability in Hospitality. International Journal of Hospitality Management, 102, 103233.