Test Your Skills 109 Difference Lost Year ($) This Year ($) % PRIME COST OTHER CONTROLLABLE EXPENSES Direct Operating Expenses 171,114 198,215 Music & Entertainment 3,228 11,436 Marketing 61,342 95,295 Utilities 103,314 133,413 Administrative & General Expenses 93,628 106,731 Repairs & Maintenance 48,429 53,366 Total Other Controllable Expenses CONTROLLABLE INCOME NON-CONTROLLABLE EXPENSES 168,000 180,000 Occupancy Costs 0 Equipment Leases 58,114 83,861 Depreciation & Amortization Total Non-Controllable Expenses RESTAURANT OPERATING INCOME 127,334 121,450 Interest Expense INCOME BEFORE INCOME TAXES 313,850 261,315 Income Taxes NET INCOME was to increase her total sales by 15 % . Did she achieve this goal? a. Laurie's goal b. One of Laurie's plans to increase traffic into her restaurant and thus increase her sales was to hire a mariachi band to play at regular intervals during the meal service. This affected her music and entertainment expense. What was the percentage of difference in music and entertainment expense? Do you think this had a positive or negative effect on sales? c. Laurie also wanted to increase her net income by 10% . Did she achieve this goal? Hroun Inckron is the chief engineer of a large hotel in the New England. Her general manager has asked her to 5. Laurie Llamos manages a Mexican restaurant in a rural Texas town. She wants to develop a comparative (horizontal) income statement so that she can compare the differences in her revenues, expenses, and profits from this year to last Income Taxes NET INCOME year. Complete the following comparative income statement. Difference Laurie's Comparative Income Statement $ % This Year ($) Last Year ($) SALES 3,499,239 Food 3,025,618 772,528 Beverage 622,649 Total Sales COST OF SALES Food 997,622 1,151,165 Beverages 132,370 144,849 Total cost of sales LABOR Management 269,262 299,913 Staff 628,277 771,206 Employee Benefits 138,828 167,720 Total Labor