Restaurant Planning Case Study - opinion
Eating into Costs 19 February Caterers are under pressure to reduce costs as their clients adjust to the economic downturn. Do you understand your subsidy. Sales are clearly a very important element of any catering budget. Equally as important is the control of costs that produce the sales since any mistakes here go straight to the bottom line as a debit. It is important to manage the sales and costs effectively. It is a mistake to think that having a small number of customers using the catering operation will result in a lower cost of catering. The contribution to the cost of catering will be generated by the volume and spending power of the customers. Therefore, if the number of people available to use the service is low, there will be little or no profit produced to offset the operating costs.Restaurant Planning Case Study Video
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Task: Question 1: Donald is the owner of a small restaurant, and is considering renovating his kitchen and buying new equipment to keep up with increasing business. The final repayment will coincide with the completion of the renovation. Donald can reopen his restaurant immediately after this.
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Donald's bank account pays interest at 5. For the purposes of this question, assume he can both invest and borrow at this rate. After discussing his situation, the bank has agreed to lend money CCase Donald for this renovation at an effective fortnightly rate of 0. Using the new interest rate, determine the present value of these 10 repayments. Hence determine the benefit in present value terms Donald gains by spreading out his repayment over 10 installments. Would the benefit calculated in part Restaurant Planning Case Study be larger or smaller if Donald had stuck with the higher interest rate from before the renegotiation?
Larger benefit, since a higher interest rate would lead to a lower present value of the repayments. Larger benefit, since a higher interest rate would result in a larger future value. Smaller benefit, since a higher interest rate would lead to a lower present value of the repayments.
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Smaller benefit, since a higher interest rate would result in larger repayments in the future. Question 7: Today, the renovation of Donald's restaurant has been completed. He believes that the renovation will bring in additional profit for his restaurant. Donald plans to sell his restaurant after 6 years.
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He would like to see an effective annual return of For the purposes of this part only, assume there are no other additional profits resulting from the renovation. What is the new minimum Restaurant Planning Case Study level weekly profit that would need to be generated over the next 6 years for Donald to achieve his return of Judy and Sarah are two different investors, both interested in purchasing the restaurant. She calculates that in addition to the purchase price, she would have to pay:?
These renovations will finish one month from today, when the restaurant is expected to be ready to open. Explicitly, the first payment is exactly 2 months from the purchase date.
Which of the following is an equation that, when Rewtaurant, would give the effective monthly rate Judy earns on her investment? She has projected the following cash flows:? Determine the effective monthly rate that Sarah would be earning on this investment 1mark This Management Assignment has been solved by our Management experts at TV Assignment Help.
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