Professional Documents
Culture Documents
PART A
Case Study Analysis on Budget Variance
Top of the Town Hotel has asked you to calculate the variance for the following figures for the
month of July and August. Also calculate the total profit that was budgeted and actual. Analyse
the findings and inform them about the variance as they are concerned and would like to
monitor the income, expenditure, profit levels, budgetary performance of their Food and
Beverage Department.
Item
Sales
Revenue
Food Costs
Beverage
Costs
Labour
Costs
Fixed Costs
Total Costs
Profit
Budget
200,000
July
Actual
189,000
Budget
190,000
August
Actual
177,000
85,000
14,000
87,000
15,000
85,000
15,000
86,000
15,000
77,000
82,000
78,000
82,000
35,000
35,000
35,000
35,000
Variance
Variance
The Hotel owners and managers would like to know from you the major areas of concern where
there is a deviation that needs further monitoring and improvement.
Please provide a written analysis of the results and the possible reasons for the variances
based on the Budgeted Actual results.
PART B
Answer the following questions.
Questions:
1. What are the four (4) main points of importance for the owners to monitor budgets and what
are the reasons why you think it will help them to manage their finances better for the
business.
1.
2.
3.
4.
2. Explain to them the use of analysing the monthly budget and comparing the forecasted
budget against the actual budgets?
4. Research and suggest what improvements do you think the owners can take to improve this
situation?