Jerry Smith has found a location on Tremont Street in Boston to open a pizza and sub shop. The store size is 1,200 square feet and it requires about $100 per square foot in renovation, fixtures and equipment (balance sheet item not an income statement item). The rent for the said location is $67,000 per year. Jerry is planning to be open 7 days a week 15 hours per day. Jerry projects the store sales per day to be $2,200 (7 days a week 52 weeks a year). In addition, Jerry is counting on having 3 employees at all time in the store at an average pay of $15.15 per hour.

Jerry has contacted you to help him to determine the following on an annual basis

Sales/Revenues $ COGS $ COGS % Gross Profit $ Gross margin % Variable Cost $ Contribution margin $ Contribution margin % Fixed Cost $ EBITDA $ Break Even point sales $ Jerry has supplied you with the following information: Sales Categories Pizza Subs Soda % to total sales 59% 36% 5% COGS% 40% 40% 30% Anticipated pay date Monthly-In the middle of the month Monthly-second week of the month Monthly At the end of the month Operating cost Per Month Per Year Anticipated pay date Rent Monthly-First week of the month Payroll Weekly-Once a week Benefits and Taxes 21% Weekly-Once a week Utilities 500 Monthly-In the middle of the month Telephone 200 Monthly-In the middle of the month Computer Maintenance 100 Monthly At the end of the month POS Expense 1,200 Monthly At the end of the month POS Lease 75 Monthly-In the middle of the month Vehicle Lease 330 Monthly-First week of the month Vehicle Fuel 200 Weekly-Once a week Merchandise Supplies 3% Monthly-In the middle of the month Office Supplies 100 Monthly-In the middle of the month Professional fees 1,200 Monthly-In the middle of the month Insurance 2,500 Monthly-First week of the month Commission 2.5% Monthly At the end of the month Marketing 25,000 Monthly At the end of the month Credit Card Fees 2.9% Weekly-Once a week Miscellaneous 1,987 Monthly At the end of the month *middle of the month is week 3 **end of the month is week 4 In addition Jerry has asked you to forecast the store's cash flow for 5 weeks average. The beginning cash is $6,500. Name: Cash in Week 1 Week 2 Week 3 Week 4 Week 5 Beginning cash Sales Total cash in Cash out Payables (Variable cost and Fixed cost) Pizza Subs Soda Credit card fees Merchandise Supplies Commission Rent Payroll Benefits and Taxes Utilities Telephone Computer Maintenance Computer Expense Computer Lease Vehicle Lease Vehicle Fuel Marketing Office Supplies Professional fees Insurance Miscellaneous Total cash out Net Cash flow O Sales/Revenues $ COGS $ COGS % Gross Profit $ Gross margin % Variable Cost $ Contribution margin $ Contribution margin % Fixed Cost $ EBITDA $ Break Even point sales $ Jerry has supplied you with the following information: Sales Categories Pizza Subs Soda % to total sales 59% 36% 5% COGS% 40% 40% 30% Anticipated pay date Monthly-In the middle of the month Monthly-second week of the month Monthly At the end of the month Operating cost Per Month Per Year Anticipated pay date Rent Monthly-First week of the month Payroll Weekly-Once a week Benefits and Taxes 21% Weekly-Once a week Utilities 500 Monthly-In the middle of the month Telephone 200 Monthly-In the middle of the month Computer Maintenance 100 Monthly At the end of the month POS Expense 1,200 Monthly At the end of the month POS Lease 75 Monthly-In the middle of the month Vehicle Lease 330 Monthly-First week of the month Vehicle Fuel 200 Weekly-Once a week Merchandise Supplies 3% Monthly-In the middle of the month Office Supplies 100 Monthly-In the middle of the month Professional fees 1,200 Monthly-In the middle of the month Insurance 2,500 Monthly-First week of the month Commission 2.5% Monthly At the end of the month Marketing 25,000 Monthly At the end of the month Credit Card Fees 2.9% Weekly-Once a week Miscellaneous 1,987 Monthly At the end of the month *middle of the month is week 3 **end of the month is week 4 In addition Jerry has asked you to forecast the store's cash flow for 5 weeks average. The beginning cash is $6,500. Name: Cash in Week 1 Week 2 Week 3 Week 4 Week 5 Beginning cash Sales Total cash in Cash out Payables (Variable cost and Fixed cost) Pizza Subs Soda Credit card fees Merchandise Supplies Commission Rent Payroll Benefits and Taxes Utilities Telephone Computer Maintenance Computer Expense Computer Lease Vehicle Lease Vehicle Fuel Marketing Office Supplies Professional fees Insurance Miscellaneous Total cash out Net Cash flow O