Part D

It is September and the budget is as follows:

	July Budget	July Actuals	August Budget	August Actuals
INCOME
Accommodation	3150	5020	2940	3670
Food	1680	1820	1890	2040
Beverages	1638	1680	1680	1896
TOTAL REVENUE	6468	8520	6510	7606
EXPENSES
Overhead
Stock	1,327	2,100	1,428	2,300
Lease	1,500	1,500	1,500	1,500
Repairs/maintenance	400	600	400	300
Advertising	200	200	200	200
Laundry	800	1,000	800	950
Wages	1,617	1,532	1,628	1,450
Miscellaneous	600	560	600	400
TOTAL EXPEND.	6,444	7,492	6,556	7,100
+/-	24	1,028	-46	506
Cash on hand: start	10,000	10,000	10,024	11,028
Cash on hand: end	10,024	11,028	9,978	11,534

You as the manager and the small order cook have agreed to speak to your fruit and vegetable supplier to see if there are any possibilities of reducing the cost of your purchases. You want to reduce your delivery from 4 days per week to twice a week and rather than telling them what fruit and vegetables you want, you are requesting them to select the best quality for the cheapest price, ie the cheapest on the day.

Also as part of cost savings you have had to make the decision to move away from local suppliers of shelf items such as porridge, flour, herbs and spices, sugar, etc. Now that Costco has opened you have the option of buying in bulk. You have calculated that this will save you approximately $3,000 - $4,000 per year.

1. Enter the above budget income and expenditure amounts for July and August to produce a suitable report.
2. Draft the communication with the supplier outlining your request and ask them to provide you with the best possible pricing structure.
3. Draft a communication to bosses regarding your evaluation of the budget, how in your effort to reduce expenditure, this has caused a slump in customer service, recommendations for changes to the budget and the impact that the changes will have positive and negative.