You are the executive housekeeper of the Royal Hotel, London. It is September and the rooms division director asks you to submit a budget draft (rough estimate) for the coming fiscal year. The projected total rooms revenue has been set at $3,500,000.

Prepare the draft of your operating budget using the following list of items that you think you will need for the year. Show dollars and percentages for the projected revenue, costs, and income (departmental profit).

Estimated salaries and wages for the year: $280,000

Estimated cleaning supplies cost: 5% of total revenue

Estimated guest supplies cost: $35,000

Estimated linen replacement cost: $70,000

Complete the table below:

Budget	Dollars	Percentage
Revenue
Salaries & Wages
Cleaning Supplies (5% of revenue)
Guest Supplies
Linen Replacement
Departmental Income

INVENTORY EXERCISE

As executive housekeeper of an Omni hotel in Orlando, Florida, you have been made aware by the hotel controller that the use of guest supplies has been unusually high for the past three months. To investigate the issue, you decide to take inventory on May 31. These are your findings:

Value of guest supplies on beginning inventory May 1^st: $4,500

Value of purchases of guest supplies for the month of May: $800

Value of physical inventory taken on May 31^st: $2,800

The rooms division revenue for the month of May was: $190,000

The budget percentage (expense / revenue) target for guest supplies was: 0.5%

Find:

Cost of guest supplies used in May.

Difference between cost percentage results in May and budgeted cost percentage.

Which are the probable causes for the difference?