Financial Forecasting for an Italian Restaurant Business Plan

This report provides a financial forecast for an Italian restaurant business plan, including profit and loss statements, cash flow statements, and break-even points. The report includes a three-year profit and loss forecast, a cash flow statement, and a break-even analysis. The report is relevant for students studying business, finance, or hospitality management.

E Managing Enterprise in the
21st Century

Contents
INTRODUCTION.......................................................................................................................................................................................3
MAIN BODY..............................................................................................................................................................................................3
Profit and Loss Forecasted Statement......................................................................................................................................................3
Cash Flow Statement...............................................................................................................................................................................4
Forecasted Balance Sheet........................................................................................................................................................................6
Break-Even Point.....................................................................................................................................................................................7
Margin of Safety......................................................................................................................................................................................7
REFERENCES............................................................................................................................................................................................8

INTRODUCTION
A business plan is a document which elaborates in detail about how the business will continue its business operations and it also
states the objective and goals of the management. It also draws a map for which includes various strategies such as financial, operation
and marketing strategies of management. In the following report it is related with the Italian restaurant (Davidson III, 2018).
.
MAIN BODY
Profit and Loss Forecasted Statement.
PROFIT & LOSS FORECAST FOR THREE YEARS
Particulars
Jan
uary
Febr
uary
Mar
ch
Apri
l May June July
Aug
ust
Septe
mber
Octo
ber
Nove
mber
Dece
mber
TOT
AL
Year
2
Year
3
Sales /
Income
£
30,0
00
£
37,0
00
£
43,5
00
£
44,0
00
£
56,7
80
£
59,8
20
£
62,1
00
£
65,9
80
£
64,25
0
£
65,2
60
£
57,84
0
£
69,85
0
£
6,56,
380
£
7,50,
000
£
8,50,0
00
Less
Materials
Cost
£
5,50
0
£
5,75
0
£
5,75
0
£
4,25
0
£
6,00
0
£
6,25
0
£
615
£
675
£
625
£
635
£
635
£
675
£
37,36
0
£
8,250
£
9,750
Less Direct
Wages
£
800
£
850
£
875
£
900
£
925
£
1,12
5
£
12,5
00
£
13,0
00
£
14,50
0
£
17,7
00
£
11,00
0
£
13,00
0
£
87,17
5
£
1,40,
000
£
1,52,5
00
GROSS
PROFIT
£
23,7
00
£
30,4
00
£
36,8
75
£
38,8
50
£
49,8
55
£
52,4
45
£
48,9
85
£
52,3
05
£
49,12
5
£
46,9
25
£
46,20
5
£
56,17
5
£
5,31,
845
£
10,39
,990
£
20,49,
580

Operating
Expenses
Staff
Salaries
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,000
£
5,00
0
£
5,000
£
5,000
£
60,00
0
£
6,250
£
6,750
Staff wages
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,000
£
1,00
0
£
1,000
£
1,000
£
12,00
0
£
1,250
£
1,500
Rent &
Rates
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,150
£
2,15
0
£
2,150
£
2,150
£
25,80
0
£
2,750
£
3,150
Gas &
Electricity
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,000
£
1,00
0
£
1,000
£
1,000
£
12,00
0
£
1,250
£
1,250
Insurances
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,000
£
7,00
0
£
7,000
£
7,000
£
84,00
0
£
8,550
£
8,800
Postage &
Stationery
£
1,00
0
£
1,01
0
£
1,01
0
£
1,00
0
£
1,10
0
£
1,02
0
£
1,03
0
£
1,01
0
£
1,110
£
1,21
0
£
1,200
£
1,210
£
12,91
0
£
1,299
£
1,320
Repairs &
Maintenance
£
2,50
0
£
2,30
0
£
2,50
0
£
140
£
250
£
260
£
420
£
620
£
120
£
620
£
410
£
2,450
£
12,59
0
£
627
£
628
Travelling &
Motor
Expenses
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,000
£
1,00
0
£
1,000
£
1,000
£
12,00
0
£
1,200
£
1,200
Loan
Installment
£
12,0
00
£
12,0
00
£
12,0
00
£
12,0
00
£
12,0
00
£
12,0
00
£
12,0
00
£
12,0
00
£
12,00
0
£
12,0
00
£
12,00
0
£
12,00
0
£
1,44,
000
£
14,40
0
£
14,40
0
Telephone
Expenses
£
510
£
520
£
510
£
520
£
530
£
520
£
550
£
500
£
510
£
520
£
510
£
520
£
6,220
£
636
£
654
Professional
Fees
£
2,25
£
2,26
£
2,24
£
2,25
£
2,26
£
2,14
£
2,36
£
2,14
£
2,520
£
2,62
£
2,410
£
2,010
£
27,46
£
2,789
£
2,985

0 0 0 0 0 0 0 0 0 0
Advertising
&
Promotions
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,250
£
2,25
0
£
2,250
£
2,250
£
27,00
0
£
2,700
£
2,700
Miscellaneo
us Expenses
£
240
£
260
£
250
£
260
£
250
£
210
£
210
£
240
£
290
£
280
£
270
£
280
£
3,040
£
319
£
326
TOTAL
EXPENSES
£
£
37,9
00
£
37,7
50
£
37,9
10
£
35,5
70
£
35,7
90
£
35,5
50
£
35,9
70
£
35,9
10
£
35,95
0
£
36,6
50
£
36,20
0
£
37,87
0
£
4,39,
020
£
8,40,
140
£
16,42,
530
Net Profit
(Loss)
Before Tax
-£
14,2
00
-£
7,35
0
-£
1,03
5
£
3,28
0
£
14,0
65
£
16,8
95
£
13,0
15
£
16,3
95
£
13,17
5
£
10,2
75
£
10,00
5
£
18,30
5
£
92,82
5
£
1,99,
850
£
4,07,0
50
Cash Flow Statement.
Cash flow Statement
Particular
Jan
uar
y Feb
Mar
ch
Apr
il May
Jun
e July
Aug
est
Sept
emb
er
Oct
ober
Nov
emv
er
Dec
emb
er
Total(
Year
1)
Year
2
Year
3
A. Cash flow from
operating activities:-
Sales/Revenue
£
30,0
00
£
37,0
00
£
43,5
00
£
44,0
00
£
56,7
80
£
59,8
20
£
62,1
00
£
65,9
80
£
64,2
50
£
65,2
60
£
57,8
40
£
69,8
50
£
6,56,3
80
£
60,0
00
£
65,0
00
Payment of salary
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
5,00
0
£
60,00
0
-£
33,0
00
-£
33,0
00
Rent Paid
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
2,15
0
£
25,80
0
-£
2,59
2
-£
2,59
2
Staff Wages £
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
1,00
£
12,00
-£
12,0
-£
12,0

0 0 0 0 0 0 0 0 0 0 0 0 0 00 00
Payment of Utilities
£
2,50
0
£
2,30
0
£
2,50
0
£
140
£
250
£
260
£
420
£
620
£
120
£
620
£
410
£
2,45
0
£
12,59
0
-£
1,20
0
-£
1,20
0
Phones
£
510
£
520
£
510
£
520
£
530
£
520
£
550
£
500
£
510
£
520
£
510
£
520
£
6,220
-£
120
-£
120
Fright and postage
£
1,00
0
£
1,01
0
£
1,01
0
£
1,00
0
£
1,10
0
£
1,02
0
£
1,03
0
£
1,01
0
£
1,11
0
£
1,21
0
£
1,20
0
£
1,21
0
£
12,91
0
-£
60
-£
60
Stationary
£
1,00
0
£
1,01
0
£
1,01
0
£
1,00
0
£
1,10
0
£
1,02
0
£
1,03
0
£
1,01
0
£
1,11
0
£
1,21
0
£
1,20
0
£
1,21
0
£
12,91
0
-£
14
-£
16
Promotion and
advertisement
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
2,25
0
£
27,00
0
-£
18,0
00
-£
18,0
00
Legal Expenses
£
2,25
0
£
2,26
0
£
2,24
0
£
2,25
0
£
2,26
0
£
2,14
0
£
2,36
0
£
2,14
0
£
2,52
0
£
2,62
0
£
2,41
0
£
2,01
0
£
27,46
0
-£
50
-£
50
Transport
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
1,00
0
£
12,00
0
-£
600
-£
600
Vehicle running
-£
250
-£
250
-£
250
-£
250
-£
250
-£
250
-£
250
-£
250
-£
250
-£
250
-£
250
-£
250
-£
3,000
-£
3,00
0
-£
3,00
0
Insurance
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
7,00
0
£
84,00
0
-£
220
-£
220
£
2,50
0
£
2,30
0
£
2,50
0
£
140
£
250
£
260
£
420
£
620
£
120
£
620
£
410
£
2,45
0
£
12,59
0
-£
1,20
0
-£
1,20
0
Misc. Expense
£
240
£
260
£
250
£
260
£
250
£
210
£
210
£
240
£
290
£
280
£
270
£
280
£
3,040
-£
220
-£
220
Setup cost -£ £ £ £ £ £ £ £ £ £ £ £ -£ £ £

14,6
00 - - - - - - - - - - -
14,60
0 - -
Net cash flow from
operating activities:-
£
43,5
50
£
64,8
10
£
71,6
70
£
67,4
60
£
80,6
70
£
83,4
00
£
86,2
70
£
90,2
70
£
88,1
80
£
90,4
90
£
82,4
00
£
98,1
30
£
9,61,9
00
-£
12,2
76
-£
7,27
8
B. Cash flow from
financing activities:-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
Net Cash flow from
financing activities:-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
C. Cash flow from
Investing activities:-
Initial investment
made
£
20,0
00
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
20,00
0
£
-
£
-
Net cash flow from
investing activities:-
£
20,0
00
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
-
£
20,00
0
£
-
£
-
Total cash
inflow/outflows(A+
B+C)
£
63,5
50
£
64,8
10
£
71,6
70
£
67,4
60
£
80,6
70
£
83,4
00
£
86,2
70
£
90,2
70
£
88,1
80
£
90,4
90
£
82,4
00
£
98,1
30
£
9,81,9
00
-£
12,2
76
-£
7,27
8
Forecasted Balance Sheet.
Statement of financial Positon for the year ended
Particular Year 1 Year 2 Year 3
Shareholders’ Funds:-

Net Profit for the year ended
£
15,000.00
£
25,000.00
£
32,000.00
Capital
£
20,000.00
£
20,000.00
£
20,000.00
Non-Current Liability:-
Long term liabilities -
£
10,000.00
£
25,000.00
Current Liability:-
£
15,000.00
£
25,000.00
£
35,000.00
Total (A)
£
50,000.00
£
80,000.00
£
1,12,000.00
Non-Current Assets:-
Other Non Current Assets
£
25,000.00
£
47,000.00
£
60,000.00
Current Assets:-
Inventory
£
10,000.00
£
15,000.00
£
32,000.00
Cash and Cash Equivalent
£
15,000.00
£
13,000.00
£
20,000.00
Total (B)
£
50,000.00
£
75,000.00
£
1,12,000.00

Break-Even Point
Break-even Point = Fixed cost / (Revenue per unit – variable cost)
In First Year = £4,39,020 / (65.36 – 12)
= 439020 / 45.36
= 9679 units
Margin of Safety
Margin of Safety (In percentage) = (Current sales level – Break-even point) / Current Sales level * 100
= (10000 - 9679) / 9679 * 100
= (321/ 9679) * 100
= 0.03316 * 100
= 3.32%
Margin of Safety (In units) = Current Sales units – Break Even Sales
= 10000 units – 9649 units
= 321 Units

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