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Thaifoon Restaurant Case Essay

Decent Essays

Bo Zhang
EEE451 Case 4 Questions
September 11, 2012

Case 4 THAIFOON RESTAURANT

* Prepare a spreadsheet for the restaurateur to project his net profits.
From exhibit 3, Thaifoon restaurant forecast that there would be 18 turns (5 lunch turns and 13 dinner turns) each week. And the owner planed to have 30 or fewer seats in order to meet the legal regulations and design. So it means there are 30 seats for each turn. Daily Turnover Ratio | | Lunch | Dinner | Revenue | $12.00 | $25.00 | Monday | 1 | 1.5 | Tuesday | 1 | 1.5 | Wednesday | 1 | 1.5 | Thursday | 1 | 1.5 | Friday | 1 | 2.5 | Saturday | 0 | 2.5 | Sunday | 0 | 2 | Number of Seats | 30 | |

Moreover, the restaurant would open 52 weeks …show more content…

The revenue is $600,600*1.2= $720,720. The variable cost changes as sales increases and fixed cost stays the same, the gross profit is $175,500. After tax, the net income is $100,557. Thaifoon Restaurant Income Statement | | Year 1 | Lunch turns | 312 | Dinner turns | 811.2 | Total turns | 1123.2 | Revenues | 720,720 | Fix cost | 68,375 | Food cost (37% of food sales) | 214,718 | Drink cost (25% of drink sales) | 35,100 | Credit card cost | 10,811 | Labor cost (30% of total sale) | 216,216 | Total variable cost | 476,845 | Total cost | 545,220 | Gross profit | 175,500 | Admin expenses | 0 | Marketing expenses | 0 | EBITDA | 175,500 | Amortization | 19,414 | EBIT | 156,086 | Interest expenses | 0 | Earnings before taxes | 156,086 | Taxes | 55,529 | Net income | 100,557 |

* What other factors should be considered?

Mr. Phimphrachanh wants to draw $100,000 from the business by the end of 2006. But based on his financial projections, the after tax net income is less than $100,000. Moreover, there are some other factors that he should consider.

First, the macro

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