Assumption about Oporto based on Income statement and balance sheet:

1.Estimate the Revenue of Oporto:

-As an Australian fast food restaurant franchise company, the revenue of Oporto come from
many fast food items like as grilled chicken, their secret sauces, burger and traditional
Portuguese cooking methods. From the franchising Oporto earned annual revenue almost
$44.8 million per year. (Source: oporto.com.au)
-the estimate revenue of Oporto per employees $175000. It’s also an effective sectors for
Oporto.
-From the income statement we can see, Oporto earned total revenue $27 million in 2021. As
a stable company Oporto will increase their revenue year after year.
- Burger king is the major competitor of Oporto. The revenue amount of Oporto will estimate
mostly equivalent 7% with burger king.

2. Expense of Oporto:

- Because of restaurant business, Oporto have huge expense on its business. Most of the cost
depend on raw materials. So that Almost 60% of revenue used for cost of raw materials on
Oporto. The amount of cost of goods sold increase day by day.

-Operating expense is also an important part of Oporto. All most 15% of revenue of Oporto
used for total operating expense. It’s also an important cost for Oporto franchise in Australia.

-On the other hand, the additional cost of Oporto is maintenance cost. Almost 5% used for the
maintenance cost.

3. Salaries of employees:

-One of the major expense of Oporto is employees cost. As a restaurant business Oporto
needed huge number of employees. So that they can response customer order quickly. The
salaries amount of employees in Oporto franchise will estimate mostly equivalent 10% with
burger king.

-Oporto use a minimum budget for initial training of their employees. They use almost 3% of
their revenue for making skillful employees.

- Maintain a range of different development courses that’s why manager and employees can
develop their knowledge and skill. So that Oporto used 5% of revenue of their income.

4. Interest Expense:

- As a newly business of Oporto, It has some interest expense. Net non-operating interest
expense occurs in financial statement of year 2021.
 -Oporto uses all most 2% of net profit for their interest interest expense. That the company have
taking lone different banks.

5. Financial expense of Oporto:

-Location and set up cost is one of the fundamental cost for Oporto. Most of the store of Oporto
located in busy shopping mall strip or shopping center etc. For this reason, Oporto used huge amount of
money for maintain their location set up.

-Franchise Fee of Oporto in Australia is $50000 (plus GST) that cover 5 years of franchise agreement.
The franchise fee of Oporto all most equivalent with Burger king.

-Oporto Pays 6% of ongoing royalty based on weekly sales.

6. Operation and maintenance of Oporto:

-Oporto franchise in Australia mostly focus on their best quality service. So that the Service and
maintenance cost of Oporto generates from their upkeep of various aspects. This value was mostly
assumed that t 15% of Burger king service and maintenance cost.

-The operational and maintenance cost of Oporto increase 4% in year after year. Like as maintenance for
the equipment, improve their raw materials etc.

-Improve their employee’s skills for deliver best quality of hospitality to their customer. That’s why they
need 3% of revenue for deliver best quality service to their customer.

7. Sales and Marketing:

-Investing in Sales and marketing expense is also related with the 4% of operating revenue of
Oporto.

-As a starting business of Oporto need to invest in sales and marketing for set up the position on
consumer mind. For this reason, customer can know about their Oporto franchise in Austalia.

-Oporto used huge amount for advertising and promotion. It’s like equivalent of 20.8% of Burger king
advertisement and promo cost for the same reasons. (Source:  Statista Research Department, Jan
14, 2021)
-Most of the components of sales and marketing of Oporto Increase day after day. They used all most
2% of money from their net income of business.

8. Other Operating Expense:

-Generally food franchise restraints are highly expensive to make up based on quality and number of
volume equipment for made the food. Almost 5% of revenue used for other operating expense on
Oporto.

-Based on Franchising Australia 2016 report, average cost of franchise are begins from
$60000 for those are non- retail franchise and $300000 for the retail franchise.

-Electricity bill and Rent expense also the major operating expense for the newly began Oporto.
9. Estimate Tax expense of Oporto:

-One of the major thing of Oporto franchise business is Govt. Tax. As a Franchise business Oporto
provide a minimum amount of tax to the Australian government. Oporto provide 31.12% of tax to their
government.

-Tax expense of Oporto mostly equivalent of 3% of Burger king income tax.

10. Oporto’s Current Asset:

-Oporto’s Property, Plant, Land, Equipment are estimate with the share capital like as Burger king share
capital of property plant and Equipment.

-Oporto’s Good will also measure as an intangible asset and make a proper impact on their share price in
the market. Good will of Oporto mostly equivalent of 10% of Burger king’s good will.

-Other Non-current asset have also a good impact on Oporto’s business same as Burger king Non-
current Asset.

11. Oporto’s current Liabilities:

-Oporto’s short term debt, account payable and others liabilities are measure as Burger king short term
debt, account payable and others liabilities.

-Oporto’s current liabilities are used all most 27% of money from their net sales revenue of business.

12. Retain Earning of Oporto:

-As a newly Business of Oporto franchise in Australia, the profitable amount after tax used as a fully
retain.