AMU Reading and Understanding Financial Statements Analysis

Description

Write a full financial synopsis based on a hypothetical fast food restaurant. Attached is a mock financial report indicating actual sales and expenses versus budgeted sales and expenses for a one year period of time. Review the report and write a 5 page financial review of this business incorporating the following areas:Part I: Analysis (Sections 1 – 3)Sub-divide your analysis into three distinct sections: 1) Revenue, 2) Expenses, and 3) Profitability

For each section, review the financial statement below and comment on:Current status, apply vertical analysis to both Actual Results and Budgeted Results.Determine and comment on the variance as it applies to each section. Ask yourself things like:How did management perform against what was budgeted?What are the strengths and weaknesses of this operation per section based on your variance analysis?Create graphs or charts to illustrate and help clarify your synopsisPart II: Recommendations & Budgeting (Sections 4 and 5)

After your financial analysis in sections 1 – 3, add two more sections; 4) Recommendations and 5) Budgeting.Section 4: Based on your synopsis in sections 1 – 3, what recommendations would you make to upper management that would reduce expenses and increase revenues. For example:Talk about your thoughts on product mix. Where should they focus their marketing dollars next year in order to increase profit margin?How will your recommendation affect food cost?What other recommendations would you make based on this year’s performance?Consider doing some outside research of current fast food chains, compare how they perform versus this operation to support your recommendationsSection 5: Prepare next year’s budgetCreate next year’s budget based on what it would look like if upper management accepted your recommendationsConsider doing some outside research of current fast food chains, compare how they perform versus this operation to support your recommendations

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Explanation & Answer:
5 pages

Tags:
business and finance

Financial Statements

fast food restaurant

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