You have recently graduated from the SRHM Program and you are currently employed by a small lodging property (Naples Hotel). Your first week on job the owner/general manager told you that he is...

You have recently graduated from the SRHM Program and you are currently employed by a small lodging property (Naples Hotel). Your first week on job the owner/general manager told you that he is interested in investing in a new restaurant adjacent to the lodging facility. He needs some financial projections for 12 months from September 2019 to September 2020, and for the proposed American/Regional Menu Themed Restaurant operations he provides you with the following information:

1. Food Revenues:
1. Average food check $15
2. Seat turnover 2.5
3. Available seats in restaurant 60
2. Cost of Food Sold 30 % of Total Food Revenues

3. Variable Expenses (as a % of Total Food Revenues):
1. Food labor-18%
2. Food other expense-2%
3. A&G other-2%
4. Marketing-6%
5. Maintenance-6%

4. Beverage Revenues:
1. Beverage sales is 32% of Total Food Revenues

5. Cost of Beverage Sold 30 % of Total Beverage Revenues

6. Variable Expenses (as a % of Total Beverage Revenues):
1. Beverage labor-20%
2. Beverage other expense-1%
3. A&G other-3%
4. Marketing-5%
5. Maintenance-5%

7. Other Fixed Expenses:
1. Depreciation-$5,500 / month
2. Utilities-$3,500 / month
3. Insurance- $1,500 / month
4. Property taxes- $5,000 for the year
5. Maintenance-$550 / month

8. Income tax rate-20 percent (as a percentage of income before taxes).

9. Assume the property will be open 365 days of the year.

Required: Prepare an income statement in accordance with the USALI.

Work Sheet # 1 Calculations to support information on the summary income statement

Round off ALL calculations to the nearest dollar value.

You have recently graduated from the SRHM Program and you are currently employed by a small lodging property (Naples Hotel). Your first week on job the owner/general manager told you that he is interested in investing in a new restaurant adjacent to the lodging facility. He needs some financial projections for 12 months from September 2019 to September 2020, and for the proposed American/Regional Menu Themed Restaurant operations he provides you with the following information:

1. Food Revenues:

a. Average food check $15; Annual Ave. Check = ( $15 x 365) = $ ______________(a)

b. Seat turnover 2.5; Annual Seat Turnover = (a. $____________x 2.5 = $______________ (b)

c. Seats in restaurant 60; Annual Revenues = (b. $___________ _x 60 = $______________ (c)

Total Food Revenues (TFR) = the value of “c.” = $______________ (c)

2. Cost of Food Sold 30 % of Total Food Rev. (30% of TFR $ ______________) = $_______________

3. Variable Expenses (as a % of Total Food Revenues):

a. Food labor-18% of (TFR____________________) = $________________

b. Food other expense-2% (TFR ___________________ ) = $________________

c. A&G other-2% (TFR ___________________ ) = $________________

d. Marketing-6% (TFR __________________ ) = $________________

e. Maintenance-6% (TFR ___________________ ) = $________________

4. Beverage Revenues:

a. Beverage Rev. is 30% of food Rev. (30% of TFR $_____________________) = $________________

5. Cost of Beverage Sold 32 % of Total Bev. Rev. (32% of TBR $____________ ) =$________________

6. Variable Expenses (as a % of Total Beverage Revenues):

a. Beverage labor-20% (TBR _____________________) = $________________

b. Beverage other expense-1% (TBR _________ ___________ ) = $________________

c. A&G other-3% (TBR _____________________) = $________________

d. Marketing-5% (TBR ___________ _________ ) = $________________

e. Maintenance-5% (TBR ____________________ ) = $________________

7. Other Fixed Expenses:

a. Depreciation-$5,500 / month ($ _____________ x 12 = $_________________

b. Utilities-$3,500 / month ($ ______________ x 12 = $________________

c. Insurance- $1,500 / month ($ __________ ___ x 12 = $________________

d. Property taxes- $5,000 for the year ($ _____________ x 1 = $________________

e. Maintenance-$550 / month ($ _____________ x 12 = $________________

8. Income Tax Rate-20 percent (as a percentage of income before taxes).

Calculation of Income Taxes

Income before income tax (From Income Statement) $

Income Tax = (Income before income tax X Tax Rate) $____________X .2 = $______________

9. Assume the property will be open 365 days of the year.

Required:

Prepare an income statement in accordance with the USALI.

STEP # 2 Instructions for Entering Information on the F & B Summary Income Statement

“A to D” numbers came from Step # 1 Food

A. Food Net Revenues (see calculations # 1 in step # 1) $_________

B. Food Cost of Revenues (see calculations # 2 in step # 1) $_________

C. Food Payroll and Related Expense (see calculations # 3a in step # 1) $_________

D. Food Other Expense (see calculations # 3b in step # 1) $_________

“E to H” numbers came from Step # 1 Beverage

E. Beverage Net Revenues (see calculations # 4 in step # 1) $_________

F. Beverage Cost of Revenues (see calculations # 5 in step # 1) $_________

G. Beverage Payroll and Related Expense (see calculations # 6a in step # 1) $_________

H. Beverage Other Expense (see calculations # 6b in step # 1) $_________

“I to K” numbers came from Step # 3 Income Statement

I. Food Income (Loss) = Net Rev. – (Cost of Rev. + Payroll & Related Exp. + Other Exp.) $_________

_______________________________________________________________________

J. Beverage Income (Loss) = Net Rev. – (Cost of Rev. + Payroll & Related Exp. + Other Exp.) $_________

_________________________________________________________________________

K. Total F & B Income/Loss (TFBIL) = Total Net Rev. F& B – (Total Cost of Rev + $_________

Total Payroll & Related Expenses + Total Other Expense)

_______________________________________________________________________

“L” numbers came from Step # 1 Food and Beverage

L. Total Undistributed Operating Exp. (TUOE) = A & G + S & M + P M + UC $_________

Administrative and General (3c & 6c) ($_____________ + $____________ $_________

Sales and Marketing (3d & 6d) ($_____________ + $____________ $_________

Property Maintenance (3e, 6e, & 7 e) ($_____________ + $____________ + $________ $_________

Utility Costs (7b) $_________

“M” numbers came from Step # 3 Income Statement

M. Gross Operating Profit (GOP) = TFBIL (same as K above) - TUOE

$_________________ _ $__________________ $_________

“N” numbers came from Step # 1, 7c and 7d

N. Total Fixed Charges (TFC) = Insurance + Property Taxes

$__________ + $_____________ $_________

“O” numbers came from Step # 3, Income Statement

O. Net Operating = GOP – TFC $__________ - $_____________ $_________

“P” numbers came from Step # 1, 7a

P. Depreciation & Amortization (D&A) see calculation # 7a in step #1 $_________

“Q and S” numbers came from Step # 3 Income Statement

Q. Income Before Income Taxes (IBIT) = NOI – D&A

$__________ - $_____________ $_________

R. Income Taxes (IT) = Income Before Income Tax X 20% (see calculation # 8 in step # 1) $_________

S. Net Income (NI) = IBIT – IT = $__________ - $____________ $_________

Name: (Typed) Assigned Problem # 1: Income Statement Date: (Typed)

Naples Hotel
Food & Beverage Summary Income Statement Projections for
September 30, 2019 to September 30, 2020

1. What are the direct expenses of the food departments? $

2. What are the direct expenses of the beverage departments? $

3. What are the total overhead cost? $

4. What are the total net revenues for Naples Hotel? $

5. What are the total costs of revenues for Naples Hotel? $

6. What the total Payroll and related expenses for Naples Hotel? $

7. What are the total other expenses for the Naples Hotel $

NOTE (From Page 8 of the Syllabus):

ALL assignments MUST be typed up using font size 12 and submitted using WORD DOCUMENT FORMAT. DO NOT SUBMIT ASSIGNMENTS IN PDF FORMAT because I CANNOT make written commence on a PDF document when grading assignments. See reminder for submission below.

Reminder Before Submission in the Drop Box on Canvas

1. Remove the NOTE above on the Income Statement before submission in the drop box.

2. ALL hand written submission in the drop box will received ZERO (0) POINTS

3. Any violation(s) FGCU Academic Integrity Guidelines will result in zero (0) points given for the assignment and student(s) violations submitted to FGCU Code of Conduct Office.

4. ALL calculations MUST be shown on work sheet # 1 and # 2 to support your answers on the Income Statement. Next attach ONLY Work Sheet # 1 and # 2 to the back of the completed Income Statement then submission on Canvas in the drop box provided. Therefore, your submission in the Drop Box on Canvas will consist of three (3) pages (Income Statement; Work Sheet # 1; and Work Sheet # 2. Points will be deducted if calculations are NOT shown on Work Sheet # 1 and # 2.

IF YOU SUBMIT MORE THAN 3 PAGES FOR ASSIGN PROBLEM # 1, I WILL ONLY GRADE THE FIRST 3 PAGES AND IGNORE ALL OTHER PAGES.

The completed Income Statement MUST have your name typed at the top left side of the Income Statement, and due date of the assignment on the top right as shown on the Income Statement above. Writing your name or changing numbers with a pen or pencil will result in five (5) point’s deductions.

5. Points Distributions:

Work sheets 1 & 2 = 10 points each;

Income Statement = 10 points; and

Professional appearance = 5 points (meaning that your work is neatly organized, with

clarity, free from error(s) and follow the guidelines for preparation and submission in

the drop box). NO partial points will be given for Professional Appearance.

Total points for Assignment # 1 = 35 points.