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Income Statement. Statement of Earnings Profit and Loss Statement Statement of Operations Frequency - Daily, Weekly, Monthly, Quarterly, Annually. Income Statement. Reports on a Period of Time Departmental Income Statements Uniform System of Accounts . Questions Answered.

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income statement
Income Statement
  • Statement of Earnings
  • Profit and Loss Statement
  • Statement of Operations
  • Frequency - Daily, Weekly, Monthly, Quarterly, Annually
income statement2
Income Statement
  • Reports on a Period of Time
  • Departmental Income Statements
  • Uniform System of Accounts
questions answered
Questions Answered
  • How Profitable Was Business?
  • What Were the Total Sales?
  • How Much Was the Labor Cost?
  • What Was Food Cost Percent?
questions answered4
Questions Answered
  • Are Sales In(de)creasing?
  • Are Expenses In(de)creasing?
  • What Were Marketing Costs?
  • What Percent of Sales Is Profit?
elements of income statement
Elements of Income Statement
  • Revenue - Sale of Goods and Services; Investment Income; Rental Income
  • Expenses - Outflows to Produce Goods; Cost of Goods Sold; Labor; Controllable Expenses; Noncontrollable Expenses
elements of income statement6
Elements of Income Statement
  • Other Gains and Losses - From Incidental Transactions; Acts of Nature
  • Period Income or Loss - Add/Deduct To/From Equity
elements of income statement7
Elements of Income Statement
  • Internal Users - Management
  • External Users - Summary Statement
uniform system of accounts
Uniform System of Accounts
  • Standardized Accounting System
  • Industry Driven
  • Basic Formats
  • Departmental Statement and Schedules
uniform system of accounts9
Uniform System of Accounts
  • Explanations and Discussions
  • Allows Comparison - Other Operations and Self
  • Can Be Used by Any Size Operation
uniform system of accounts10
Uniform System of Accounts
  • Property Level Designed Use
  • Direct Operating Expense Based on Cost of Goods Sold, Direct Labor Expense, Direct Expenses
contents of the income statement
Contents of the Income Statement
  • Operated Departments
  • Net Revenues by Department
  • Cost of Sales
  • Payroll and Related

See page 95 for sample

contents of the income statement12
Contents of the Income Statement
  • Other Direct Expenses
  • Departmental Income –

Net Department Revenues

Less Departmental Expenses

contents of the income statement13
Contents of the Income Statement
  • Non Operated Departments
  • Undistributed Operating Expenses
  • Payroll and Related and Other Are Shown Separately
contents of the income statement14
Contents of the Income Statement
  • Administrative and General
  • Data Processing
  • Human Resources
  • Transportation
contents of the income statement15
Contents of the Income Statement
  • Marketing
  • Property Operations and Maintenance
  • Energy Costs
  • Income After Undistributed Operating Expenses
contents of the income statement16
Contents of the Income Statement
  • Other Expenses (Board Decisions)
  • Management Fees
  • Fixed Charges (Capacity Costs)
  • Other Gains or Losses
  • Sale of Property/Equipment
income statement analysis
Income Statement Analysis
  • Comparative Statements
  • Horizontal Analysis
    • Calculate Absolute Change (Dollar Difference)
    • Calculate Relative Change (Percentage Difference)
  • Investigate Significant Differences
  • Internal Analysis
income statement analysis19
Income Statement Analysis
  • Common Size Statements
  • Vertical Analysis
  • Total Revenue Equal 100%
  • Each Expense Shown As Percentage of Total
  • Compare to Industry, Like Businesses or Self
data availability
Data Availability
  • PKF Consulting - Trends in the Hotel Industry (U.S. and Worldwide)
  • PKF Consulting - Clubs in Town and Country
data availability22
Data Availability
  • Arthur Andersen & Smith Travel Research - The Host Report - Hotel Operating Statistics
  • NRA - Restaurant Industry Operations Report
  • Local Hotel Organizations
cost of goods sold calc
Cost of Goods Sold Calc

Beginning Inventory

+ Purchases

= Goods Avail For Sale

- Ending Inventory

= Cost of Goods Consumed

- Transfer Out

- Employee meals

+ Transfer In

= Cost of Goods Sold

adjustments
Adjustments
  • Intraunit transfers
  • Interunit transfers
  • Grease sales
  • Steward sales
  • Gratis to bars
adjustments25
Adjustments
  • Promotion expenses
  • Employee meals
  • To General Manager
  • “Comps”
cost of goods sold example
Cost of Goods Sold Example
  • Assume:
    • Beginning Inv $10,000
    • Purchases $50,000
    • Ending Inv $25,000
    • Room Div Emp Meal $15,000
    • Transfer From Bar $1,000
    • Transfer to Banquets $1,500
cost of goods sold example27
Cost of Goods Sold Example

$10,000 Beginning Inv

$50,000 Purchases

$60,000 Goods Avail Sale

($25,000)Ending Inv

$35,000 Cost of Goods Consumed

($15,000) Room Div Emp Meal

$1,000 Transfer From Bar

($1,500) Transfer to Banquets

$19,500 Cost of Goods Sold

cost of food or beverages sold
Cost of Food or Beverages Sold
  • Food or beverage cost percent equals cost of goods sold divided by food or beverage sales
  • What is reported to management?
gain or loss calc
Gain or Loss Calc

Original Cost

- Accumulated Depreciation

= Book Value

Sales Price

- Book Value

= Gain if positive

= Loss if negative

gain or loss example
Gain or Loss Example
  • Assume

Purchased Truck for $10,000

Accumulated Depr is $6,000

Sold Truck For $5,000

gain or loss example31
Gain or Loss Example

$10,000 Purchase Price

(6,000) Accum Depr

4,000 Book Value

$5,000 Sales Price

(4,000) Book Value

1,000 Gain (Since positive)

key items to remember
Key Items To Remember
  • Revenues are listed Net of Allowances
  • Cost of employee meals are part of that dept’s expenses not cost of food sold
  • Taxes and Benefits considered as part of payroll expense
  • See page 90 for the 14 Rooms Division Major Other Expenses
key items to remember33
Key Items To Remember
  • See pages 90 - 92 regarding
    • Administrative
    • Security
    • Marketing
    • Transportation
    • Property
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