FAPC Assignment

Boulevard Group 7

Sandwiches, •Akshay………………………….B19004
Inc.(A) •Nikhil Jindal………………….B19030
•Ravi Shankar…………………B19037
Forecasted Revenue
Boulevard Sandwiches Unit 2 2017 2018
     
Forecasted Revenues    
Meals sold 1,82,000.0 2,00,200.0
   
Sales volume at:  
Lunchtime 69,160.0 80,080.0
% of Sales 38.0% 40.0%
Dinner 1,12,840.0 1,20,120.0
% of Sales 62.0% 60.0%
   
Sales price at:  
Lunchtime 7.5 7.5
Dinner 10.5 10.5
   
Gross Sales 17,03,520.0 18,61,860.0
   
Less: Discount -45,500.0 -50,050.0
Net Sales 16,58,020.0 18,11,810.0

• Meals Sold is expected to increase by 10% from 2017

• Lunch was 38% of meals in 2017 and 40% of Meals were projected to be lunch in 2018
• Coupons were being released in local newspapers costing 0.5$ per meal(valid for 2 weeks)
 Forecasted Expenses
  Boulevard Sandwiches Unit 2 2017 2018
       
  Forecasted Expenses    
I Food Costs 9,36,936.0 10,24,023.0
  % of Gross Sales 55.0% 55.0%
   
II Employee expenses 1,82,400.0 1,99,040.0
  % of Gross Sales 10.7% 10.7%
   
III Other Operating Expenses 1,36,281.6 1,48,948.8
  % of Gross Sales 8.0% 8.0%
   
IV Advertising Expenses 59,623.2 65,165.1
  % of Gross Sales 3.5% 3.5%
   
V Depreciation 24,000.0 24,000.0
   
VI Insurance Premiums 9,400.0 9,400.0
   
VII License and Fees 11,250.0 11,700.0
   
IX Rent Expenses 72,000.0 75,093.0
   
XI Management Expenses 95,000.0 95,000.0
   
XII Miscellaneous Expenses 3,000.0 3,000.0
   
  Total Expenses 15,29,890.8 16,55,369.9

• Food Costs were 55% of Gross Sales, Operating expenses were 8%, License fees is expected to grow by 4%
and Rent was $6,000 per month and 5% of excess of gross sales above $1,800,000
Note II: Employee Expense

Note II    
Employee Expenses 2017 2018
Number of employees:  
Kitchen staff 4.0 4.0
Cashiers & Servers 16.0 16.0
   
Avg. wage per hr:  
Kitchen staff 12.0 13.0
Cashiers & Servers 3.0 3.0
   
Avg. hours worked:  
Kitchen staff 2,000.0 2,000.0
Cashiers & Servers 1,800.0 1,980.0
   
Employee costs:  
Kitchen staff 96,000.0 1,04,000.0
Cashiers & Servers 86,400.0 95,040.0

Total Employee Expense 1,82,400.0 1,99,040.0

• Kitchen Staff wages were raised by 1$ in 2018 from 12$ to 13$
• Cashier and Servers work hours depended on customers so increase in 10% customers will lead to
increase of 10% in Cashier and Servers work hour
Note IV: Advertising Expense

Note IV    
Advertising Expenses 2017 2018
Use by manager 8,517.6 9,309.3
% of Gross Sales 0.5% 0.5%
   
Broadcast Media 17,035.2 18,618.6
% of Gross Sales 1.0% 1.0%
   
Print Media 17,035.2 18,618.6
% of Gross Sales 1.0% 1.0%
   
Ad Preparation 17,035.2 18,618.6
% of Gross Sales 1.0% 1.0%

Total Advertising Expense 59,623.2 65,165.1

• Advertising Expense were kept at level of 3.5% of Gross Sales for both 2017 and 2018
• 1% for Broadcast Media, Print Media and Ad Preparation each and 0.5% for use by manager
Projected Profit

Boulevard Sandwiches Unit 2 2017 2018

     
Forecasted Profits    
Net Sales 16,58,020.0 18,11,810.0
   
Total Expenses 15,29,890.8 16,55,369.9
Profit before Tax 1,28,129.20 1,56,440.10
% margin 7.7% 8.6%

• Profit Before Tax is increasing by 22.1% in 2018 for the given assumptions
• PBT Margin is expected to increase from 7.7% in 2017 to 8.6% in 2018
Thank You