Goel is contemplating whether to add a vegan menu to the Yalla Momos restaurant brand or to start a new restaurant brand called Dinefest to provide vegan and low-cost healthy eating options. Below is the budgeting information for the Dinefest business model which will offer memberships to customers to visit Goels restaurants of their choice.

Task 1

Explain which of the costs will be relevant if he decides to establish Dinefest as a separate restaurant brand. Explain any other factors that Goel should take into consideration before deciding whether to go ahead with Dinefest.

Task 2

Explain how the application of beyond budgeting could benefit Goel.

Budget information 2019 Gourmet Membership Fee Budget 2017 Number of Restaurants Average number of members per Premium restaurant Basic Total Average membership fee per month Premium (AED) Basic Total membership fees per year (AED Premium 000) Basic Total City 3 365 115 480 50.00 25.00 18,250 2,875 21,125 Suburbs 2 305 104 409 45.00 20.00 13,725 2,080 15,805 Total 5 670 219 889 95.00 45.00 31,975 4,955 36,930 Sales Budget 2019 Number of Restaurants Average number of members per restaurants Total sales revenue (AED 000) 5 889 36, 930 Per member AED Total AED 000 Number of members per restaurant 670 219 Yearly membership fees Premium Yearlymembership fees Basic Total sales revenue from membership 47.50 22.50 31,825 4,927.50 36,752.50 Task 2 Explain which of the costs will be relevant if he decides to establish Dinefest as a separate restaurant brand. Explain any other factors that Goel should take into consideration before deciding whether to go ahead with Dinefest. Task 3 Explain how the application of beyond budgeting could benefit Goel. Operating Profit Budget 2019 AED 000 Total AED 000 36,752.50 Per Restaurant AED 000 AED 000 7,350.50 Sales revenue Operating expenses Restaurant operating costs Lease costs Staff costs Head office costs Depreciation Amortisation (15,920) (1,500) (8,822) (3,065) (2,650) (1,215) (3,184) (300) (1,764.4) (613) (530) (243) (33172) 3,580.50 (6,634.4) 716.1 Operating profit Budget information 2019 Gourmet Membership Fee Budget 2017 Number of Restaurants Average number of members per Premium restaurant Basic Total Average membership fee per month Premium (AED) Basic Total membership fees per year (AED Premium 000) Basic Total City 3 365 115 480 50.00 25.00 18,250 2,875 21,125 Suburbs 2 305 104 409 45.00 20.00 13,725 2,080 15,805 Total 5 670 219 889 95.00 45.00 31,975 4,955 36,930 Sales Budget 2019 Number of Restaurants Average number of members per restaurants Total sales revenue (AED 000) 5 889 36, 930 Per member AED Total AED 000 Number of members per restaurant 670 219 Yearly membership fees Premium Yearlymembership fees Basic Total sales revenue from membership 47.50 22.50 31,825 4,927.50 36,752.50 Task 2 Explain which of the costs will be relevant if he decides to establish Dinefest as a separate restaurant brand. Explain any other factors that Goel should take into consideration before deciding whether to go ahead with Dinefest. Task 3 Explain how the application of beyond budgeting could benefit Goel. Operating Profit Budget 2019 AED 000 Total AED 000 36,752.50 Per Restaurant AED 000 AED 000 7,350.50 Sales revenue Operating expenses Restaurant operating costs Lease costs Staff costs Head office costs Depreciation Amortisation (15,920) (1,500) (8,822) (3,065) (2,650) (1,215) (3,184) (300) (1,764.4) (613) (530) (243) (33172) 3,580.50 (6,634.4) 716.1 Operating profit