Create a case study with 4 scenarios. Compare each week and determine how the applied scenarios affected your costs.

Assignment Question

 Create a case study with 4 scenarios. Compare each week and determine how the applied scenarios affected your costs.

Did they affect your profits? How did your costs change? You do have creative liberty to add in additional details if you feel like it contributes to your vision of what happened or how you envisioned it happening. Make sure to include your different charts and scenarios. When using terms from class, make sure to highlight them, as well as the variations in your weekly workbooks. You will determine what was successful and what you should have done differently.

Your paper should also give a suggestion as to how the business should proceed. Your main objective is to be able to demonstrate that you understand the behavior of the costs. Week 1 – Create a scenario where your sales increase by 25%. Increase your cost of goods sold proportionately. How does this change your labor cost and efficiency? Do you think it is reasonable to do these sales numbers with the same labor hours? How does this affect your fixed costs?

Week 2 – Create a scenario where your lowest paid employee is taken off the schedule for the week. Redistribute the hours between the rest of the employees. Do not forget to calculate overtime when applicable. How does this change your labor calculations? What assumptions might you make about productivity with a schedule of seasoned employees if this were your template?

Week 3 – Increase the cost of your top 2 “A” inventory items by 40%. Blame this increase on one of the factors discussed in class. Do not increase your selling price. How does this increase change your food cost? Contribution margin? Profit? Address whether or not you should find a lower quality ingredient as a replacement or if you should increase your selling price.

Week 4 – Create some sort of promotion of event. Lower the selling price of you items by 20%, but increase your sales volume (or guest count) by 40%. Add 1 hr per day per employee. Increase the cost of goods sold proportionate to how much volume it sold. Did your profit increase or decrease? How did your costs compare to your temple? Do you feel like this is a sustainable decision moving forward?

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