Food & Beverage Management -I
Cost Control
HT 225
OPERATIONAL BUDGETING AND COST-VOLUMEPROFIT ANALYSIS
Dr Mohamed El-Sayed Abdel-Aziz
February 2014
King Abdul Aziz University Tourism Institute Diploma in Hospitality Management
HT 225: Food &Beverage Management 1 – Cost Control
Slide 1 of 7
Operational Budgeting and Cost-VolumeProfit Analysis
o
Budget
o
Sales Forecasts
o
Sales Variance
o
Analysis of Sales/Volume
King Abdul Aziz University Tourism Institute Diploma in Hospitality Management
HT 225: Food &Beverage Management 1 – Cost Control
Slide 2 of 7
Forecasting or Estimation of projected
revenue, expense, and profit.
•If
significant variations with planned
results, management must:
1.
Define the problem
2.
Determine the cause
3.
Take corrective action
King Abdul Aziz University Tourism Institute Diploma in Hospitality Management
HT 225: Food &Beverage Management 1 – Cost Control
Slide 3 of 7
Advantages to Precise Sales Forecasts

Revenue, Expense Estimates $

Scheduling Workers

Scheduling F. and S. Production needs

Proper purchasing of amounts of food

Increased operational efficiency

Increased dollars for growth

Increased profit and stockholder value
King Abdul Aziz University Tourism Institute Diploma in Hospitality Management
HT 225: Food &Beverage Management 1 – Cost Control
Slide 4 of 7
Sales This Year – Sales Last Year =
Variance
 Percentage variance
the percentage change in sales from one
time period to the next.

Sales This Year –Sales Last Year
Sales Last Year
= Percentage Variance

King Abdul Aziz University Tourism Institute Diploma in Hospitality Management
HT 225: Food &Beverage Management 1 – Cost Control
Slide 5 of 7
Overall sales increases or decreases can
be computed using the following :
1- Determine sales for this accounting
period.
2- Determine the difference between this
period’s sales minus last period’s sales.
3- Divide the difference in #2 by last
period's sales to determine percentage
variance.
King Abdul Aziz University Tourism Institute Diploma in Hospitality Management
HT 225: Food &Beverage Management 1 – Cost Control
Slide 6 of 7
Thank You
King Abdul Aziz University Tourism Institute Diploma in Hospitality Management
HT 225: Food &Beverage Management 1 – Cost Control
Slide 7 of 7