Bounce Fitness is a premier provider of fitness and wellness in Australia. It is made up of four...

Question

Bounce Fitness is a premier provider of fitness and wellness in Australia. It is made up of four fitness centres. Head office is currently established in Cairns, Queensland. The other centres are in Brisbane, Sydney and Melbourne.

To complete this task, you are required to review theProfit and Loss Report of Bounce Fitness in Cairns.

Profit and Loss-Cairns

Analyze and review the information in the profit and loss report – then provide detailed answers to the questions in the following Budget Report Template:

BSBFIN501 Task 3 Budget Report Template.docx

· Completed Budget Report Template

profit-and-loss-cairns-1-oet5ldmk.pdf bsbfin501-task-3-budget-report-template-b2znslf0.docx

Khushboo · Accepted Answer

Budget Report Review
	BSBFIN501 Task 3 Budget PROFIT & LOSS REVIEW
Review the Profit and Loss Report attached in your Assessment Task 3 
Analyse and review the information – then provide detailed answers to the following
	Type or Section of Plan
	Profit and Loss
	Is the cost of sales worth keeping the lines open?
Discuss the profit or loss this is causing and what recommendations you would make.
	The entity’s sales revenue is $323,100 and $323,435 in year 20X1 and 20X2 respectively whereas the cost of sales is only $8,700 and $8,874 in year 20X1 and 20X2 respectively. It shows that the entity is having cost of sales as 3% only and the entity is having 97% gross margin to cover its operating and other expenses. The cost of sales is worth keeping the lines open because the cost of sales is very low and the entity is having very higher margin for other expenses.  
The profit and loss of the entity is not significantly impacted by cost of sales because the cost of sales is only 3% of sales revenue. The entity has incurred losses in both years mainly due to higher operating and non- operating expenses and it is recommended the entity to reduce the operating expenses in significant manner to keep the line opens and to achieve target profitability.
	Review all of the figures – are the total calculations correct ?
Identify any errors you can locate
	In the case, there are some errors in calculation. The total sales for year 20X2 are $323,435 whereas if we add the all the three-line items of sales revenue i.e., casual attendance $53,100, memberships $241,000 and Equipment and clothing $29,000 then the total will come $323,100 whereas the total has been shown as $323,435 which shows that there is error of $335 ($323,435- $323,100) in year 20X2. Further,

Bounce Fitness is a premier provider of fitness and wellness in Australia. It is made up of four fitness centres. Head office is currently established in Cairns, Queensland. The other centres are in...

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