- Executive Summary
- Problem Statement
- Recommendation and Conclusion
Lols Manage at D'Cafe Ola Tax Internal control and management Pricing About D'Cafe Ola Three years ago, Daren graduated with a business degree from a local university college. During his semester holidays, he learned to bake and cook at home, supervised by his mother. They did small-scale catering and used Instagram and Facebook as mediums to promote their food. Sometimes, Daren would deliver their food to the Klang Valley and nearby offices. A year ago, a local bank promoted financing for micro-entrepreneurs and Daren was lucky enough to have been granted a loan. Daren and his mother improved their business and with their savings they opened a cafe called D'Cafe Ola at a new lot of shophouses near the area where they live. They then engaged a company secretary to assist their business registration as a Sdn Bhd. Positive reviews The menu included both local and Western dishes, along with a selection of baked goods. Health drinks and Case 2 Management and fruit juices were also served, with healthy sandwiches made fresh in front of the customers. When asked about the cafe, the feedback from the customers were positive. It received rave reviews: 'it's like a one-stop centre for food', 'a good range of food all day round', 'a bit of kopitiam, a bit of Thai and a bit of Western', 'good, fresh and healthy food too', 'perfect for all in the family'. Challenging early days The first few months were tough but Daren persevered. Coping with the volume and hygiene as well as staff turnover was difficult, being new, but Daren did not giving up. Determined to grow bigger, Daren adopted aggressive marketing strategies and promoted their food and services to everyone, including university students and office staff. The discounts given to certain groups of customers actually increased the volume of sales of the food. no Increased sales Daren has found that his sales increased from week to week after the special aggressive marketing campaign. He has brought in more staff board but they are working on a commission-based salary, as well as on a part-time basis by shift employment, as the cafe operates from 7 a.m. till 1 a.m. every day. Daren is aware of several issues of internal control but through trial and error he is running the cafe like one-man show. His mother is sometimes behind the cash machine but payment is facilitated Integrated Case Studies for Accounting 8 more by cashless cards, coupons and online payments, which reduce the risk of cash shortages. The following simple income statement was recorded after a year of operating the cafe: bout Income statement for the year ended 31 December 2018 RM VBD S 500,000 Sales Less: Cost of sales (200,000) Gross profit 300,000 Less: Administration and selling expenses (100,000) onthou bo Other overheads illu (30,000) Net profit RM70,000 391 sa ba269730 100 Application Questions room TOY 9TH TO 1 What will be the tax implications for Daren and the cafe? 1919 2 Would the business be open to an audit exercise since it is a Sdn Bhd mais brints shoes 3 What would be a good pricing strategy for the cafe considering the variety of food on its menu? 4 What are the internal controls that Daren needs to have in place? 5 Would having a manager in charge of the different smaller departments help with the running of the cafe? Discuss
