PRELIM: COMPUTATION

A. Sun Ye Jin manages a Korean restaurant called Fine Table. Her P&L for the month of March is as
follows. (25 points)

Fine Table ’s March P&L

Revenue $ 100,000.00 100.0%

F&B Expense 34,000.00 34.0%
Labor Expense 40,000.00 40.0%
Other Expense 21,000.00 21.0%
Total Expense 95,000.00 95.0%
Profit $ 5,000.00 5.0%

Sun Ye Jin has a meeting with the owner of the Bungalow next week.

At the meeting with the owner, Jin is asked to change the information on the pie chart to reflect next
month’s projections. The owner suggests that April revenues and costs should be as follows:

April revenues = $120,000, food and beverage expense = $44,000, labor and other expenses remain
constant.

Revenue $120,000.00 100%

F&B Expense 44,000.00 36.67%
Labor Expense 40,000.00 33.33%
Other Expense 21,000.00 17.5%
Total Expenses 105.00 87.5%
Profit $15,000.00 12.5%

Using these numbers, is the owner’s profit percentage going to be higher or lower than that in March? By
how much?

Answer: ____________________________________________________________

After looking at the owner’s projections, she thinks it might be too difficult (and not so good for her guests)
if she cannot increase labor cost along with sales. She proposes a compromise and tells the owner that if he
will agree to increased labor costs, she will try to decrease other expenses. So, Jin proposes the following:

April revenues = $120,000, food and beverage expense = $44,000,

labor expense = $50,000, and other expense = $19,000.

Revenue $120,000 100%

F&B Expense 44,000 36.67%
Labor Expense 50,000 41.67%
Other Expense 19,000 15.83%
Total Expenses 113,000 94.17%
Profit $7,000 5.83%

Using these numbers, is the owner’s profit percentage going to be higher or lower than that in March? By
how much?

Answer: ______________________________________________________

Which set of projections has more reasonable goals?

Answer: ______________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________
 B. Sam Gonzales operates a school foodservice department in a small, rural community. She feeds
approximately 1,000 students per day in three different locations. She receives an average of
$1.20 in revenues per meal. Her budget, set at the beginning of the school year by the
superintendent, is developed in such a way so that a small amount is to be reserved for future
equipment purchases and dining room renovation. These funds are available, however, only if
Sam meets her budget. She hopes to use this year's reserve to buy a $5,000 refrigerated salad bar
for the high school. Since it is the mid-point of her school year, help her determine her
"performance to budget" (fill in all empty blanks).
(10 points)

Item Budget Actual % of Budget

Meals Served 300,000 149,800 49.93%
Revenue 350,000 350,000 100%
Food Expense 170,000 84,961 49.98%
Labor Expense 125,000 63,752 51%
Other Expense 60,000 31,460 52.43%
Total Expenses 355,000 180,173 50.75%
Reserve 5,000 $169,827 49.25%

C. Amy Pelletier operates Hall’s House, an upscale restaurant with a $30.00 check average in mid-
town Manhattan. Her clientele consists of business persons and tourists visiting the city. Based on
the historical sales records she keeps, next year Amy believes her business will achieve a food
sales increase of 4% per month for each of the first six months of the year. She feels this increase
will be the result of increases in guest counts (not check average).

At mid-year (July 1), Amy intends to increase her menu prices (and thus, her check average) by 2%. She
feels that while these price increases could result in a slight, short-term reduction in her guest counts, the
restaurant’s guest counts will still increase 3% for the last six months of the year.

Taking into account her guest count growth estimates and mid-year price increases, Amy would like to
estimate her predicted year-end food revenues. Prepare the revenue estimates for Hall’s House. (Fill in
all empty blanks) (50 points)

Months January Through June

Guest Guest Count Guest Original
Count % Increase Count Check Revenue
Month Last Year Estimate Forecast Average Forecast
January 6,270 4% 251 $30
February 6,798 4% 272 $30
March 6,336 4% 253 $30
April 6,400 4% 256 $30
May 6,930 4% 277 $30
June 6,864 4% 275 $30
6 month total 39,598 4% 1,584 $30

Months July Through December

Guest Guest Count Guest New
Count % Increase Count Check Revenue
Month Last Year Estimate Forecast Average Forecast
July 6,845
August 6,430
September 6,283
October 6,402
November 6,938
December 7,128
6 month total

D. Rebecca is the manager of a popular Italian Restaurant on Mott Street, and she is trying to predict
guest counts for the first week of November so that she can estimate an accurate number of servers
to schedule. Business is very good, but her sales history from last month indicates that fewer
 guests are served during the first few days of the week compared to last year, while more guests
per day are served in the later part of the week. Rebecca has entered the guest counts from last
year and the estimated percentage change in guest counts for this year in the chart below. Because
good service is so important to her, she wants to ensure that enough servers are scheduled to work
each day. One server can provide excellent service to 50 guests. Help Rebecca calculate how
many servers to schedule each day by completing the following chart. Note: Rebecca always
rounds the number of servers required up to the next whole number to ensure the best service
possible for her guests! (15 points)

Rebecca’s Guest Forecast and Server Scheduling Worksheet for the first week of November

Guest Estimated Estimated Number of

Count Change This Guest Count Servers Needed
Last Year Year This Year This Year
Sunday 625 -5%
Monday 750 -5%
Tuesday 825 0
Wednesday 850 5%
Thursday 775 5%
Friday 1,250 10%
Saturday 1,400 10%

E. Ellen Waterbird is a manager of Unlimited Samgyupsal Restaurant. She has maintained a sales
history for January through June, and she wants to compare this year’s sales with last year’s sales.
Calculate her sales variances and percentage variances for the first 6 months of the year. (15
points)

Unlimited Samgyupsal Restaurant

Month Sales This Year Sales Last Year Variance Percentage

Variance
January $ 42,500.75 $ 35,750.00 6,750 18.88%
February 47,572.00 36,485.00 11,087.00 30.39%
March 38,472.75 31,705.75 6,767.00 21.34%
April 45,550.15 34,555.55 10,994.6 31.82%
May 42,785.25 37,952.45 4,832.00 12.73%
June 38,583.50 33,254.65 5,328.00 16.02%
Total $255,465.4 $ 209,703.4 45,760.15 21.82%