Fast Food

ASSIGNMENT SUBMITTED TO SUBMITTED BY SUBJECT PROGRAM

Mr. YOUSAF BHATTI WAQAS AHMAD ECONOMICS MBA

TOPIC RESTURENT

CHASKA FAST FOOD

REVENUE For a company, this is the total amount of money received by the company for goods sold or services provided during a certain time period. It also includes all net sales, exchange of assets; interest and any other increase in owner's equity and is calculated before any expenses are subtracted. Net income can be calculated by subtracting expenses from revenue. In terms of reporting revenue in a company's financial statements, different companies consider revenue to be received, or "recognized", different ways. For example, revenue could be recognized when a deal is signed, when the money is received, when the services are provided, or at other times. There are rules specifying when revenue should be recognized in different situations for companies using different accounting methods, such as cash basis and accrual basis. EXPLICIT COST Expense that is contractual in nature and definite in amount, such as rent, salaries, wages, or utility bills. Explicit costs are easily recognizable for classification and recording. IMPLICIT COST The costs associated with an action's tradeoff. It is related to explicit costs, which represent the actual costs of an activity, and represents a cost that is not recorded but instead implied. For example, an employee could take a vacation and travel. The explicit costs would include travel expenses, the cost of a hotel room, and costs related to entertainment. The implicit costs relate to the tradeoff, namely the wages that the employee could have earned if the vacation was not taken. VARIABLE COST Periodic cost that varies, more or less, in step with the output or the sales revenue of a firm. These include raw material, energy usage, labor (wages), distribution costs, etc. Firms with high variable costs are significantly different from those with high fixed costs. This difference affects the financial structure of the firm as well as its pricing and profits.

FIXED COST Periodic cost that remains (more or less) unchanged irrespective of the output level or sales revenue of a firm, such as depreciation, insurance, interest, rent, salaries, and wages. While, in practice, all costs vary over time and no cost is a purely fixed cost, the concept of fixed costs is necessary in short-term cost accounting. PROJECT BRIEF Fast food is food which is prepared and served quickly at outlets called fast-food restaurants. It is a multi-billion dollar industry which continues to grow rapidly in many countries. A fast-food restaurant is a restaurant characterized both by food which is supplied quickly after ordering, and by minimal service. The food in these restaurants is often cooked in bulk in advance and kept warm, or reheated to order. Many fast-food restaurants are part of restaurant chains or franchise operations, and standardized foodstuffs are shipped to each restaurant from central locations. Initially Rs 5,102,250 were spend to start the business The land requirement is around 2,000 sq.ft. in densely populated area

MAIN SOURCES OF REVENUE

1.EXPLICIT COST a. FIXED COST

Rent The rent is Rs. 100,000/- per month. And Rs. 1,200,000 are given in advance before possession of premises.

VARIABLE COST:

IMPLICIT COST