1
JUNE 28
Authored by: Liana Mae D Macanas
Student no.: 11881
PROJECT
REPORT 2021

TABLE OF CONTENTS
Pages
Introduction………………………………………………………………………………… 3
About the Project………………………………………………………………………….. 4
Calculation…………………………………………………………………………………. 6
Past and current table comparison…………………………………………………… 8
Consultation on budget components………………………………………………… 9
The impacts of loss in Net profit and the reason…………………………………… 9
Investigating budget and taking appropriate action……………………………….. 10
Monitor and review budget……………………………………………………………… 11
Complete comparison table with variances………………………………………… 12
Conclusion………………………………………………………………………………… 13
References………………………………………………………………………………… 13
2
INTRODUCTION
Academia resort is a five-star hotel and known as one of good accommodation in
Australia. It has the total of 7,270 rooms sold annually. In this report, this shows the full
explanation and details of the past financial report. With the current annual report, there are
some many change regarding on the accommodation which the patronage falls at 12% and
results a total of 6,398 rooms sold in that current annual period.
In these two-year financial report of Academia resort, it shows here the financial
Turnover, food and beverage, accommodation and expenses including the before net profit
tax. This also includes the details of sales increase percentage in some sections and also the
complete details of variances, percentage change and the profit increase to 28%.
3
ABOUT THE PROJECT
Demonstrate the following when preparing the budget and report:
 Consultation on budget components
 Analysis of factors that impact on the budget
 Completion of draft and final versions of budget within designated timelines
 Monitor and review the above budget against performance over its life cycle.

4
Academia Resort anticipates the following changes in the business environment:
 Management expects an increase in interest rates of 0.25% per quarter.
 Fall in patronage of 12%.
 The guests will be willing to spend more per head if the staff up sells successfully –
management expects a 20% increase in both food and beverage average sales.
Room revenue is based on the following calculation:
 The Resort has twelve rooms and has 83% occupancy rate annually.
 Room rate is $120.00 per day. These rooms are all twins.
 The Resort has 7,270 guests a year and all food and beverage revenue come from
these guests.
Staff wages represent 25% of total revenue and management decided that in order to
ensure good service this percentage must remain the same.
5
CALCULATION
Number of Guest
100% = 7,270
Fall of patronage at 12%
7,270 x 12% = 872
7,270 – 872 = 6,398 room occupancy
6,398/ 2 =3,199 x $120 = 383,880 Accommodation revenue
Food and beverage Revenue
Food : 219,000/ 7,270 = 30.12 per person (previous)
Beverage: 73,000/ 7,270 = 10.04 per person (previous)
Food: 30.12 x 1.2 = 36.15 per person (current)
Beverage 10.04 x 1.2 = 12.05 per person (current)
Total food and beverage Revenue
Food 6,398 x 36.15 = 231,287.70
Beverage 6,398 x 12.05 = 77,095.90
Total revenue
231,287.70 + 77,095.90 + 383,880.00 = 692,263.60
COGS
Food cost: 231,287.70 x 25% = 57,821.93
Beverage cost: 77,095.90 x 30% = 23,128.77
Accommodation cost: 383,880.00 x 20% = 76,776.00
6
Gross Profit
Total revenue – Total COGS
692,263.60 – 157,726.70 = 534,537.00
Wages
Total revenue x 25%
692,263.60 x 25% = 173,065.90
Interest
17,500 / 100 = 175.00 x 0.25 = 43.75 1st Quarter
(17,500 + 43.75) = 17,543.75 / 100 = 175.44 x 0.25 = 43.86 2nd Quarter)
(17,543.75 + 43.86) = 17,587.61/100 = 175.88 x 0.25 = 43.97 3rdQuarter
(17,587.61 + 43.97) = 17,631.58/100 = 176.31 x 0.35 = 44.08 4th Quarter
Add all quarters: 43.75 + 43.86 + 43.97 + 44.08 = 175.66
Total interest: 17,500.00 + 175.66 = 17,675.66
Total operating cost
Add all operating expenses = 342,741.56
Net profit before tax
Gross profit – total operating cost
534,537.00 – 342.741.56 = 191,795.44
Final increase profit at 28%
Net profit before tax 2018- 2019 x 1.28
211,550.00 x 1.28 = 270, 784.00
7
PREVIOUS AND CURRENT COMPARISON

Consultation on budget components
8
Before jumping in another project you need to explain your current budget in as easy and
understandable way. This needs to spend some time explaining what is the current or
projected spending actually looks like. Breaking down budget spending into easily
understandable buckets or groups of money, can help your company better to understand
where money is being spent and encourage them to think about where they might be able to
find savings or how they might spend it differently. Using information graphics make it easy to
quickly look at different levels of spending and helps company to learn more about the costs
associated with delivering different services, operations or capital works programs. By using
information graphics makes everyone understand more each and every section and
individual explanation of the spending levels, and helps everyone to understand and learn
more about cost along with the different services, operations and capital work programs.
The impacts of loss in Net profit and the reason for it and explain how you would try to
maintain a positive business to meet new requirements. Investigate and take
appropriate action on significant deviations.
A company’s net profit may decrease naturally if the company loses revenue or
experience additional expenses that is out of the budget. A company may lose revenue if its
products are outdated. It may also to a competitor which has better product offerings than
what your company have. To keep your company increase revenue is you must research
market trends and study to let your products be upgraded. Offer a unique or special offers
than customers will be delighted and worth to try. A positive effect of companies generating
operational profits is the ability for the companies to expand and grow their operations.
Investgatng budget and taking appropriate acton
9
Base on the spread sheets that we compute and that results the comparison between
the previous and current sales forecast of the hotel, there are some results that have some
issues questions about the decrease and insignificant changes for the annual sales forecast
of the hotel. In year 2018-2019 the total accommodation revenue is 434,000, but when in
year 2019-2020 decrease to 383,880.00 which is result of -$50,120.00 variances. As for total
revenue is a big decrease compare to 2018-2019 which is $726,000.00 down to $692,263.60.
Moving to Cost of sales which same problem as the revenue that is the accommodation at
20%. From $86,800.00 it falls to the total $76,776.00 and has -$10,024.00 variance. It affects
the Total COGS which from 163,450.00 falls to 157,726.70 with a variance of – $5,723.30.
Also affects the current gross profit which is from $562,550.00 to $534,537.00 with a –
$28,013.00 variance.
With this kind of situation there are some things that needs to investigate like the
results happened in the accommodation section which decrease the revenue in span year
2019-2020. It also results the 83% occupancy or in digit is 6,398 rooms sold in that whole
year. Apparently, the front office department needs to be investigated about this matter
regarding the decrease of the sales in accommodation. Taking appropriate actions also is a
must to regain and increase the revenue for the future sales. Actions should be like boosting
or offering special packages like for couple or family packages to gain their attention and
make them try these packages and services and satisfy them.
Monitor and review the budget
10
There are differences between the two year annual forecast and some sections have
some changes and increases due to some reasons. In year 2018-2019 the food revenue
starts from $219, 000.00 and increase in 20% that leads to $231,287.70 with a positive
variance of 12,287.70. For the beverage as it starts at $73,000 and additional 20% also that
results of $77,075.90 with a positive variance of $4,095.90. Moving form accommodation
which seems to decrease the sales from $434,000 down to $383,880 which results of a
variance of -50,120. Overall, total revenue is from $726,000 was decrease to $692,263.60
which result a variance of negative -33,736.40. The result of the total revenue is not goof for
the future sales of the hotel.
Allocating on the cost of sales which each section has different percentage. Starting on
food which at 25% from $54,750 it increases it to $57,821.93 and has a positive variance of
3,701.93. On the next one which is the beverage at 30% from $21,900 it increases to
$23,128.77 leaving a positive variance of 1,228.77. but the next one is different though it has
32%, accommodation starts at $86,800 and decrease to $76,776 which leads to a negative
variance of -10,024 and has the same feedback result of revenue of accommodation. For the
total COGS from $163,450 it decreases to $157,726.70 with a negative variance of -5,723.30.
For gross profit from $562,550 dropped to $534,537 resulted with a negative variance
-28,013.
For the operating expenses, there are just some sections that has differences, and the
rest are fixed cost. The wages have a given of 25% increase with total revenue. From
$181,500 in decrease to $173,065.90. However, although the variance result is -8,434.10 is
that means a positive feed that lessen the expenses in wages. In the other one which is the
interest that starts at $17,500 and increase 25% quarterly that results of $17,675.66 and has
a positive variance of 175.66. In total of the operating cost from 351,000 it decreases to
$342,741.56 and has good variance of -8,258.44. More over, the Net profit before tax from
$211,550 it falls to $191,795.44 which results of negative variance of -19,754.56. With the
28% increase in net profit it results $270,784.00.
The wholes sections in both year and future financial report should always be
monitored and reviewed to know the differences, which section needs to be improved, has
the problem and easily be figured out when it comes in investigating.
11
After producing the new budget, you are required to calculate the variance, percentage
change and also prepare another budget that allows for a profit of 28%.

CONCLUSION
12
Annual financial report is very important to collect so that the company will know the
past history record differences and current ones that will result of every sections revenue fall
or increase of expenses out of the expected budget. By the help of these records you will
easily identify which sections needs to be investigate and needs to improved to have positive
outcome of the statement in the future. Hence, you will learn the importance of reviewing,
monitoring and analyzing the budget.
I therefore conclude that monitoring budget is a must and should be kept as record in
for future references to know where is to be investigated or improved. As the example of the
Academia resort financial report shown above the differences between the two year annual
financial reports.
REFFERENCE
https://online.academia21.com/LMS/
13