Financial Analysis and Making a Profit
Keeping track of the financial aspects of your firm's operation requires the attention of every member of your management staff. Long before you turn the numbers over to your accountant (or accounting department as the case may be), you should have a clear picture of where you stand from a profitability standpoint. Let's start by taking a quick and dirty look at an example of a catering firm that is doing everything right.
1. Financial Statements
Monthly Profit and Loss
| Sales | ||
| Item | Dollars | Percentage |
| Sales | $100,000 | 100% |
| Operating Expenses | ||
| Food | 28,000 | 28% |
| Beverage | 10,000 | 10% |
| Salaries | 10,000 | 10% |
| Hourly Wages | 12,000 | 12% |
| Supplies | 5,000 | 5% |
| Linens | 500 | .5% |
| Sales and Admin | 3,000 | 3% |
| Utilities | 4,000 | 4% |
| Total Operating Expenses | 72,500 | 72.5% |
| Total Operating Profit | 27,500 | 27.5% |
| Fixed Costs | ||
| Insurance | 1,000 | 1% |
| Property/Equipment | 8,000 | 8% |
| Depreciation | 500 | .5% |
| Total Fixed Costs | 9,500 | 9.5% |
| Gross Profit | 18,000 | 18% |
| Net Income | $10,800 | 10.8% |
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