Accounting for Managers: Interpreting accounting information for decision-making

(Sean Pound) #1

Table 14.2


Service budget example: Superior Hotel budget


SUPERIOR HOTEL BUDGETINCOME

Explanation

Lastyear

Current

year

Qtr 1
Jan – Mar

Qtr 2
Apr – June

Qtr 3Jul – Sep

Qtr 4
Oct – Dec

Nextyear

Rooms

No. of rooms

×

average spend

949,000

1,022,000

201,600

235,872

303,600

331,200

1,072,272

Dining

No. of rooms

×

average spend

365,000

365,000

72,000

81,900

101,200

110,400

365,500

Bar

No. of rooms

×

average spend

73,000

73,000

14,400

16,380

20,240

22,080

73,100

Business services

No. of rooms

×

average spend

29,200

29,200

5,760

6,552

8,096

8,832

29,240

Total Income

1,416,200

1,489,200

293,760

340,704

433,136

472,512

1,540,112

EXPENDITUREDirect costsFood cost of sales

35% of dining income

127,750

127,750

25,200

28,665

35,420

38,640

127,925

Liquor cost of sales

40% of bar income

29,200

29,200

5,760

6,552

8,096

8,832

29,240

Total cost of sales

156,950

156,950

30,960

35,217

43,516

47,472

157,165

Salaries and wagesHotel staff

increases 3% p.a.

212,000

218,360

56,228

56,228

56,228

56,228

224,911

Dining staff

increases 3% p.a.

75,000

77,250

19,892

19,892

19,892

19,892

79,568

Office staff

increases 4% p.a.

35,000

36,400

9,464

9,464

9,464

9,464

37,856

Management

increases 5% p.a.

50,000

52,500

13,781

13,781

13,781

13,781

55,125

Fuel, light and water

Historical/estimate

12,000

14,000

4,000

4,000

4,000

4,000

16,000

Laundry

Historical/estimate

8,000

9,000

2,500

2,500

2,500

2,500

10,000

Cleaning

Historical/estimate

6,000

7,000

2,000

2,000

2,000

2,000

8,000

Repairs and maintenance

Historical/estimate

12,000

20,000

4,000

4,000

4,000

4,000

16,000

Advertising and promotion

Historical/estimate

10,000

12,000

3,000

3,000

3,000

3,000

12,000

Telephones

Historical/estimate

4,000

5,000

1,500

1,500

1,500

1,500

6,000

Consumables

Historical/estimate

5,000

5,000

1,500

1,500

1,500

1,500

6,000

Other expenses

Historical/estimate

6,000

7,000

2,000

2,000

2,000

2,000

8,000

Total expenditure

591,950

620,460

150,825

155,082

163,381

167,337

636,624

Net profit before interest

824,250

868,740

142,935

185,622

269,755

305,175

903,488
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