Question

In: Accounting

Food sales $                 950,000 Other revenue 5% of total revenue Expenses: Fixed Variable* Labor $         

Food sales $                 950,000
Other revenue 5% of total revenue
Expenses: Fixed Variable*
Labor $                 100,000 10%
Cost of sales $                            - 35%
Supplies $                            - 5%
Energy $                   12,000 3%
Marketing $                     5,000 4%
Maintenance $                   12,000 2%
Property taxes $                     4,000
Depreciation $                   15,000
Property insurance $                     5,000
Rent $                     3,500
* As a percentage of food sales.
  1. The Robinson Diner, managed by Ina Fay, needs your assistance in preparing its 20X8 operating budget. Since the diner is a sole proprietorship, it will not pay income taxes. Information is in the Excel.
    1. Prepare the operating budget for 20X8. (9 points)

Solutions

Expert Solution

1. Operating budget for 2018 -

Operating Budget for 2018
Particulars Amount $ Amount $
Food sales              950,000 95%
Other revenue                 50,000 5%
Total Revenue           1,000,000 100%
Expenses Fixed Variable
Labor              100,000            95,000
Cost of sales                          -            332,500
Supplies                          -              47,500
Energy                 12,000            28,500
Marketing                   5,000            38,000
Maintenance                 12,000            19,000
Property taxes                   4,000
Depreciation                 15,000
Property insurance                   5,000
Rent                   3,500
Total Expenses              156,500          560,500
Operating Profit              283,000

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