Income Statements

Sands Motel
For the year of 20X1-20X3
Budgeted Actual Variaces
Revenue:
Room $ 15,620 $ 14,940 $ (680) -4.35%
Pantry 429 414 $ (15) -3.50%
Total 16,049 15,354 $ (695) -4.33%
Departmental Expenses:
Room
Payroll 2,500 2,243 $ 257 10.28% (257)
Laundry 156 150 $ 6 3.85% (6)
Lien 313 300 $ 13 4.15% (13)
Commissions 156 150 $ 6 3.85% (6)
All Other Espenses 234 200 $ 34 14.53% (34)
Total 3,359 3,043 $ 316 9.41% (316)
Pantry 422 380 $ 42 9.95% (42)
Total 3,781 3,423 $ 358 9.47% (358)
 Income Statements
Sands Motel
For the year of 20X1-20X3
20X1
Revenue:
Room $ 146,438
Pantry 2,962
Total 149,400
Departmental Expenses:
Room
Payroll 21,966 15.0%
Laundry 1,464 1.0%
Lien 2,929 2.0%
Commissions 1,470 1.0%
All Other Espenses 1,500 1.0%
Total 29,329
Pantry 2,850 96%
Total 32,179

Departmental Income:
Rooms 117,109
Pantry 112
Total 117,221

Undistributed Operating Expenses:

Administration 27,470 10%
Maintenance and Utility Costs 16,952
Total 44,422

Gross Operating Profit 72,799

Depreciation 15,000
Property Taxes 5,000
Insurance 5,000
Interest Expense 15,000
Income Before Income Taxes 32,799
Income Taxes 9,840
Net Income $ 22,959
Profit Margin 15.37%
0X3
20X2 20X3 20x4??

$ 158,634 $ 171,654
3,466 4,246
162,100 175,900

23,000 14.5% 27,465 16.0%

1,600 1.0% 1,735 1.0%
3,150 2.0% 4,324 2.5%
1,578 1.0% 1,650 1.0%
2,380 1.5% 2,575 1.5%
31,708 37,749
3,350 97% 4,285 101%
35,058 42,034

126,926 133,905
116 (39)
127,042 133,866

30,105 8.9% 32,795

19,292 21,775
49,397 54,570

77,645 79,296
15,000 15,500
5,500 6,000
5,000 5,000
16,000 15,000
36,145 37,796
10,844 11,339
$ 25,302 $ 26,457
15.61% 15.04%
 Analysis of Income Statements
Sands Motel
For the year of 20X1-20X3
20X1 20X2 20X3
Rooms Sold 4,964 5,036 5,124
Occ. % 68% 69% 70%
Average Rate $ 29.50 $ 31.50 $ 33.50
Room Revenue $ 146,438 $ 158,634 $ 171,654
Pentry revenue as a % of room revenue 2% 2.2% 2.5%

$ 149,400 $ 162,100 $ 175,900

Room expenses %
Payroll 15.0% 14.5% 16%
Laundry 1.0% 1.0% 1.0%
Lien 2.0% 2.0% 2.5%
Commissions 1.0% 1.0% 1.0%
All Other Espenses 1.0% 1.5% 1.5%
Total 20% 20% 22.0%

Administration
Payroll
Fixed 27,470 $ 20,000 $ 22,000 $ 24,000
Variable $ 4,482.00 3.0% 3.0% 2.5%
Other $ 2,988.00 2.0% 2.0% 2.5%
Maintenance and Utility Costs
Maintenance
Fixed $ 4,000 $ 4,500 $ 5,000
Variable $ 4,482.00 3% 3% 3%
Utility Costs
Fixed $ 1,000 $ 1,500 $ 2,000
Variable $ 7,470.00 5% 5.20% 5.40%
$ 16,952.00
Fixed Charges
Depreciation-Based on cost of fixed assets, expected lives, and straight-line method of depreciation
Property taxes-historically has increased by $500 for 20x1 through 20x3
Insurance-a three-year policy for 20x1-20x3 was quoted at $5,000 per year
Interest expense-based on amount borrowed and prevailing interest rates

Income taxes-based on 30% of income before income taxes

Profit margin % 15.37% 15.61% 15.04%

 Projection for
20X4
5,183 7300
71%
6% $35.50
$ 183,996.50
2.70%
$ 4,967.91
$ 188,964.41

16% $ 29,439
1% $ 1,840
2% $ 3,680
1% $ 1,840
1.50% $ 2,760

Pantry Expense $ 4,967.91

$ 27,000 $ 36,448
3.0% $ 5,668.93
2.0% $ 3,779.29
0
0
$ 6,000 $ 11,669
3% $ 5,668.93
0
$ 2,500 $ 12,704
5.40% $ 10,204.08

$ 15,700
$ 6,600
$ 6,000
$ 13,050
$ 42,266.02
25% of pre-tax $ 10,566.51
$ 31,699.52
16.8%
 Menu Engineering Worksheet
Restaurant:

(A) Menue I (B) Number S(C) Menu Mix(D) Item Food(E) Item Selli (F) Item CM ((G) Menu Cos(H) Menu Rev
Sirloin steak 240 20.17% $ 3.00 $ 9.95 $ 6.95 $ 720.00 $ 2,388.00
King crab 50 4.20% $ 6.00 $ 15.95 $ 9.95 $ 300.00 $ 797.50
Lobster 60 5.04% $ 8.00 $ 18.45 $ 10.45 $ 480.00 $ 1,107.00
Prime rib 300 25.21% $ 4.25 $ 14.50 $ 10.25 $ 1,275.00 $ 4,350.00
Whitefish 80 6.72% $ 2.50 $ 8.75 $ 6.25 $ 200.00 $ 700.00
New York stri 180 15.13% $ 5.75 $ 12.45 $ 6.70 $ 1,035.00 $ 2,241.00
Chicken a la k 280 23.53% $ 2.60 $ 8.50 $ 5.90 $ 728.00 $ 2,380.00

Column TotalN (Total Number of Units Sold)

1190
Additional Computations: O (Average Gross Margin) = M/N
$ 7.75

119
Worksheet
Date
Meal Period
(L) Menu CM (P) CM Categ (R) MM% Cat(S) Menu Item(T) Decision
$ 1,668.00 Low High Plowhorse
$ 497.50 high Low Puzzle
$ 627.00 high Low Puzzle
$ 3,075.00 high HIgh Star
$ 500.00 low Low Dog
$ 1,206.00 low High Plowhorse
$ 1,652.00 low High Plowhorse

M (Total Gross Margin)

$ 9,225.50
(Average Gross Margin) = M/N