Restaurant Financial Statement Analysis: Option A and B Comparison

This assignment presents a detailed financial analysis of a restaurant, comparing two operational options (A and B) over a three-year period (2017-2019). It includes income statements, cash flow statements, and menu designs. The income statements detail food sales, cost of goods sold (COGS), operating expenses (including advertisement, automobile, bank charges, computer, office supplies, professional fees, propane, reimbursement, rent, repairs, restaurant supplies, supplies, uniforms, and utilities), and net ordinary income. The cash flow statements cover cash flows from operations, investing activities, and financing activities, providing insights into the restaurant's cash position. Assumptions include a 2% annual inflation rate for expenses. The assignment allows for a thorough understanding of financial performance, including revenue generation, cost management, and cash flow management. The menu design provides a list of food items with prices.

Option A
2017 2018 2019 Assumtpion
Income
Food sales $ 122,000.00 $ 162,000.00 $ 212,000.00
Total income $ 122,000.00 $ 162,000.00 $ 212,000.00
Cost of goods sold
Food purcahse $ 36,600.00 $ 48,600.00 $ 63,600.00
Direct labour payroll $ 20,395.00 $ 28,274.85 $ 38,151.10
Business Licenses $ 4,005.00 $ 4,125.15 $ 4,248.90
Total COGS $ 61,000.00 $ 81,000.00 $ 106,000.00
Gross profit $ 61,000.00 $ 81,000.00 $ 106,000.00
Operating expenses
Advertisement & promotion $ 7,500.00 $ 7,650.00 $ 7,803.00
Automobile expenses $ 4,635.00 $ 4,727.70 $ 4,822.25
Bank service charges $ 216.30 $ 220.63 $ 1,000.00
Computer and internent expenses $ 1,030.00 $ 1,050.60 $ 1,071.61
Office supplues $ 54.59 $ 55.68 $ 1,000.00
Professional fees $ 6,000.00 $ 6,120.00 $ 6,242.40
Propane $ 571.65 $ 1,000.00 $ 1,500.00
Reimbursement $ 109.18 $ 500.00 $ 1,000.00
Rent expenses $ 2,500.00 $ 3,000.00 $ 3,500.00
Repairs and maintaiance $ 94.76 $ 96.66 $ 98.59
Restaurant supplies $ 2,000.00 $ 3,000.00 $ 4,000.00
Suppkies $ 1,500.00 $ 2,000.00 $ 4,000.00
Uniforms $ 75.19 $ 76.69 $ 1,000.00
Utilities $ 800.00 $ 816.00 $ 1,800.00
Total operating expenses $ 27,086.67 $ 30,313.96 $ 38,837.85
Net ordinary income $ 33,913.33 $ 50,686.04 $ 67,162.15
Other income
Ask my accountant $ 1,652.12 $ 1,701.68 $ 1,752.73
Total other expenses $ 1,652.12 $ 1,701.68 $ 1,752.73
Net operating income $ 32,261.21 $ 48,984.36 $ 65,409.41
It has
been
asumed
that all
the
expenses
are fixed
and it has
been
increased
by 2%
each year
becasue
of the
inflation
rate.

Option B
Assumtpion 2017 2018 2019 Assumtpion
Income
Food sales $ 147,000.00 $ 217,000.00 $ 307,000.00
Total income $ 147,000.00 $ 217,000.00 $ 307,000.00
Cost of goods sold
Food purcahse $ 44,100.00 $ 65,100.00 $ 92,100.00
Direct labour payroll $ 28,335.00 $ 43,614.85 $ 63,291.10
Business Licenses $ 4,005.00 $ 4,125.15 $ 4,248.90
Total COGS $ 76,440.00 $ 112,840.00 $ 159,640.00
Gross profit $ 70,560.00 $ 104,160.00 $ 147,360.00
Operating expenses
Advertisement & promotion $ 7,875.00 $ 8,032.50 $ 8,193.15
Automobile expenses $ 4,866.75 $ 4,964.09 $ 5,063.37
Bank service charges $ 227.12 $ 231.66 $ 1,050.00
Computer and internent expen $ 1,081.50 $ 1,103.13 $ 1,125.19
Office supplues $ 57.32 $ 58.47 $ 1,050.00
Professional fees $ 250.00 $ 270.00 $ 280.00
Propane $ 600.23 $ 1,050.00 $ 1,575.00
Reimbursement $ 114.64 $ 525.00 $ 1,050.00
Rent expenses $ 1,562.00 $ 1,840.00 $ 1,900.00
Repairs and maintaiance $ 99.50 $ 101.49 $ 103.52
Restaurant supplies $ 2,100.00 $ 3,150.00 $ 4,200.00
Suppkies $ 275.00 $ 210.00 $ 220.00
Uniforms $ 78.95 $ 80.53 $ 1,050.00
Utilities $ 840.00 $ 856.80 $ 1,890.00
Total operating expenses $ 20,028.00 $ 22,473.65 $ 28,750.23
Net ordinary income $ 50,532.00 $ 81,686.35 $ 118,609.77
Other income
Ask my accountant $ 1,652.12 $ 1,701.68 $ 1,752.73
Total other expenses $ 1,652.12 $ 1,701.68 $ 1,752.73
Net operating income $ 48,879.88 $ 79,984.66 $ 116,857.04
It has
been
asumed
that all
the
expenses
are fixed
and it has
been
increased
by 2%
each year
becasue
of the
inflation
rate.

Assumtpion

Option A
Cash Flow Statement 2017 2018
Cashflows from Operations
Cash receipts from customers
(enter positive amountCash Sales $ 122,000.00 $ 162,000.00
Funding from Creditors
Stock purcahsed -$ 36,600.00 -$ 48,600.00
Cash paid for
(enter negative amoun Total Expenses -$ 27,086.67 -$ 30,313.96
Net Cash Flow from Operations $ 58,313 $ 83,086
Investing Activities
Cash receipts from
(enter positive amountSale of property and equ -
Matured Investments -
Cash paid for
(enter negative amoun Purchase of property and -9000 -9000
Net Cash Flow from Investing Activities -$ 9,000 -$ 9,000
Financing Activities
Cash receipts from
(enter positive amountIncrease in short term deb- -
Increase in long term debt- -
Increase in equity (proce - -
Cash paid for
(enter negative amoun Repayment of loans - -
Dividends - -
Net Cash Flow from Financing Activities - -
Net Increase in Cash $ 49,313 $ 74,086
Cash at End of Year $ 49,313 $ 74,086

Option B
2019 Cash Flow Statement 2017 2018
Cashflows from Operations
Cash receipts from customers
$ 212,000.00 (enter positive am Cash Sales $ 147,000.00 $ 217,000.00
Funding from Creditors
-$ 63,600.00 Stock purcahsed -$ 44,100.00 -$ 65,100.00
Cash paid for
-$ 38,837.85 (enter negative amTotal Expenses -$ 20,028.00 -$ 22,473.65
$ 109,562 Net Cash Flow from Operations $ 82,872 $ 129,426
Investing Activities
Cash receipts from
(enter positive am Sale of property and equ-
Matured Investments -
Cash paid for
-9000 (enter negative amPurchase of property an -9000 -9000
-$ 9,000 Net Cash Flow from Investing Activities -$ 9,000 -$ 9,000
Financing Activities
Cash receipts from
- (enter positive am Increase in short term de- -
- Increase in long term deb- -
- Increase in equity (proc - -
Cash paid for
- (enter negative amRepayment of loans - -
- Dividends - -
- Net Cash Flow from Financing Activities - -
$ 100,562 Net Increase in Cash $ 73,872 $ 120,426
$ 100,562 Cash at End of Year $ 73,872 $ 120,426

2019
$ 307,000.00
-$ 92,100.00
-$ 28,750.23
$ 186,150
-9000
-$ 9,000
-
-
-
-
-
-
$ 177,150
$ 177,150

Menu deisgn
Appetizers
Smoked Brisket $ 138.00
Veggie Kabob $ 120.75
Garden Fresh $ 112.70
Sandwich
Gatorade $ 75.67
Loaded french fries $ 64.69
Marinated chicken $ 43.13
Cheese with beans an $ 86.17
Somked Turkey $ 211.51
Salads
Mixed fileld Greens $ 120.75
Mac and Cheese, cole $ 92.00
Beverages
Unsweetened tea $ 9.49
Fresh Squeezed $ 17.25