April 17th
David Obstfeld
Williams Coffee Pub Case Write-Up
Question 1
While build the income statement for Williams Coffee Pub write-up, I made some(prenominal) boldnesss to come up with the income statement. According to Chen, she could reach 65% to 85% potential in the first month and reach all-inclusive capacitor in 1 to 3 twelvemonths. So I came up with the assumption that in year 3 she pull up s turn backs reach full capacity because she did not have such(prenominal) experience in the coffee pub industry, and it will take about 3 years to be a common coffee pub. For the first year, she only reached 85% capacity and year 2 she reach 95% capacity, and finally year rest 3 she reaches full capacity. Anformer(a) assumption is that she went from 65% at the destroy of the first month to 85% at the end of year 1.
For year 1, I multiply full capacity 1,700,000x85%/12 it came up to $78,000 sales for the first month and from in that respect I gradually take sale during the entire year. I grew 5% from end of January to end of May, and then grew a 10% graduation June until the end of September, and grew a final 12% beginning October and ending on December. Year 2 the sales upgrade another 10% and the 3 year sales grow another 5% to reach full capacity.
My second assumption was that on modal(a) hoi polloi spend about 10$ in a coffee pub and around 260 pack enter the coffee pub assuming 99% of the people that enter the coffee shop spend on average 10$. During the year we open 360 days, excluding the holidays. Other expenses are already given on the case such as solid food/beverage 33%, local Advertisement 1%, right advertisement 1.5%, Royalties 6%, Total labor 31.5%, and other in operation(p) expenses such as utilities, cleaning, trash, at 9.5%. Chen did not trammel the percentage but I assumed that utilities were part of other operating expenses that total 9.50%.
A third assumption I made was to select a medium store coat of about 2,500 SQ FT since rent was in de middle (no spicy or low) with no drive-thru. The rent will cost...If you want to get a full essay, order it on our website: Ordercustompaper.com
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