MBA FB&E

Financial Management

Term – 3

Group Assignment-2

Submitted To: Prof. Bhavesh Patel

Submitted By: Group 5

224146 Rashi Rathod

224113 Diya Rajgor

224160 Vallabh Shah

224131 Manav Zatakiya

224103 Abhijeet Manek

Restaurant: Mummy da Dhaba

Table of Contents

1) Details about the Business: ................................................................................................. 2

1.1) Introduction ................................................................................................................. 2

1.2) Different Attribute ....................................................................................................... 2

1.3) Assumption.................................................................................................................. 2

2) Investment Details : ............................................................................................................ 3

2.1) Fixed Expense: ............................................................................................................ 3

2.2) Recurring Expense: ..................................................................................................... 4

2.3) Depreciation Calculation ............................................................................................. 4

2.4) Working Capital .......................................................................................................... 5

3) Revenue Steam ................................................................................................................... 5

4) Cash Flow Estimation ......................................................................................................... 5

5) P&L Statement ................................................................................................................... 6

6) Auxiliary ............................................................................................................................. 7

6.1) Capacity .......................................................................................................................... 7

6.2) Expense ........................................................................................................................... 8

6.3) Depreciation.................................................................................................................. 11

6.4) Terminal Values ........................................................................................................... 12

List of Tables

Table 1:List of Fixed Expenses.................................................................................................. 3

Table 2:Recurring Expense ........................................................................................................ 4
Table 3:Depreciation for Fixed Investments.............................................................................. 4
Table 4:Cash Flow Statement for 5Years .................................................................................. 6
Table 5:P&L statement .............................................................................................................. 6

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 1) Details about the Business:

1.1) Introduction

• The restaurant sector is a significant contributor to the economy, providing employment

opportunities and generating revenue. According to the National Restaurant
Association, the restaurant industry employs over 10% of the U.S. workforce and
contributes over $900 billion to the economy annually.

• We have chosen a Medium Scale Restaurant Business. The restaurant sector faces many
challenges, including the Dominance of Chef (head of the cartel), competition, rising
food and labor costs, changing consumer preferences, and the impact of external factors
such as the COVID-19 pandemic.

• However, we believe our restaurants can succeed by providing quality food, excellent
customer service, and a unique and memorable dining experience.

1.2) Different Attribute

• Name of the Business: Mummy da Dhaba

• Location of the Business: CG Road (Chimanlal Girdharlal Road)
• Services: Authentic Punjabi food
• Avg Number of the customer (Per Month):454
• Avg Coupon Size per Customer: 225

1.3) Assumption

• Total number of working days in year =360 days

• Working hours per day = 4 hours (one-time shift 7 pm to 11 pm)

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 • Maximum capacity =32 ( at a time)
• Every year cost increase by 5%
• Every year Revenue increase by 7.5 %
• Pure Veg Restaurant

Note: The details variables and assumptions will be mentioned in the Auxiliary

2) Investment Details :

We have classified Expenses into two types :

2.1) Fixed Expense:

• These are the expense which is incurred before starting the business (year 0).

Sr.no Fixed Initial Investment

1 cutlery 35192
2 Chairs and Tables 54320
3 Assets ( Cold Storage, induction) 33225.9
4 Billing System 28000
5 dress for employees 1500
Banner and menu (Main
6 building) 12140

7 Fan, light, Exhaust 35,000

total 199377.90
Table 1:List of Fixed Expenses

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2.2) Recurring Expense:

• These are the expense that is incurred every month.

Sr. Recurring expenses Amount

1 land (Rent) 50000

2 Work Force 50000
3 Raw Materials 180801.0939
4 Billing System 696
5 Transportation 3000
6 Electricity 3000
7 Miscellaneous 5000
total monthly
expense 292497.0939

Table 2:Recurring Expense

Note: The details calculation will be mentioned in the Auxiliary

2.3) Depreciation Calculation

Depreciation 1 2 3 4 5

cutlery 5278.8 4486.98 3813.933 3241.843 2755.567

Chairs and
Tables 5432 4888.8 4399.92 3959.928 3563.935
Cold Storage 6000 4500 3375 2531.25 1898.438
Induction 2121.75 1803.488 1532.964 1303.02 1107.567
Billing System 11200 6720 4032 2419.2 1451.52
Lights, fans 14000 8400 5040 3024 1814.4
Total 44032.55 30799.27 22193.82 16479.24 12591.43
Table 3:Depreciation for Fixed Investments

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 Note: The details calculation will be mentioned in the Auxiliary

2.4) Working Capital

• We have assumed the working capital to be 80,000 to present any present moment

3) Revenue Steam

• Average coupon size =225

• The average number of customers per week=454
• Average Revenue generate =102,150 Rs (Per week)
• Revenue Generation per year = 52,53,428 Rs

4) Cash Flow Estimation

cash flow estimation

S Years
r Items Notes 0 1 2 3 4 5

Initial 1993
1 Investment Fixed 77.90
8000
Working capital 0.00
Avg 225 Rs assuming 52534 56474 60709 65263 70157
2 Revenue 360 Working Days 28.571 35.714 93.393 17.897 91.74
35,09, 36854 38697 40632 42663
3 Expense from Sheet_Expense 965 63.384 36.553 23.38 84.549

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 Depreciatio from 44032. 30799. 22193. 16479. 12591.
4 n sheet_Depreciation 55 2675 81738 24077 42605
16,99, 19,31, 21,79, 24,46, 27,36,
5 EBIT 2-(3+4) 431 173 063 615 816
https://cleartax.in/s/inc 50982 57935 65371 73398 82104
6 TAX @30 ome-tax-slabs 9.2683 1.919 8.9068 4.5829 4.7293
11,89, 13,51, 15,25, 17,12, 19,15,
7 PAT 602 821 344 631 771
add Back
8 depreciation 44,033 30,799 22,194 16,479 12,591
-
1 Free Cash 2793 12,33, 13,82, 15,47, 17,29, 19,28,
0 flow 77.9 634 620 538 110 362
Table 4:Cash Flow Statement for 5Years

5) P&L Statement

• Gross Margin = 58.02%

• Net Profit Margin (Including Tax) = 22.64%

Sales 5253429
COGS 2205613
Gross Margin 3047815
Operating
Expense 1304352
Dep 44032.55
EBIT 1699431
Tax 509829.3
PAT 1189602
Table 5:P&L statement

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 6) Auxiliary

6.1) Capacity

1 No of tables 8
space required for 1 table 36
Total Space Required for tables 288 sqft
2 Kitchen 300 sqft
3 storage 200 sqft
4 Extra Space 200 sqft
5 required space 988 Approx

notes
Maximum Capacity of the restaurant at a peopl per table 4 people can
7 time 32 e occupy
8 time required to serve the customer
entering time 5 min
Food Preparing time 15 min
severing time 35 min
Exiting time ( Including cleaning, billing ) 5 min
total time 60 min
9 Restaurant Timing
7 pm to 11 pm 4 hours
1 Maximum Capacity of the restaurant per peopl
0 day 128 e

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 Days Utilization Avg people served (max 128)
Monday 25% 32
Tuesday 25% 32
Wednesday 25% 32
Thursday 40% 51.2
Friday 70% 89.6
Saturday 85% 108.8
Sunday 85% 108.8

Total 454

6.2) Expense

working
Sr items cost notes
1 land (Rent) 50,000
2 Work Force 50,000 1
3 Raw Materials 180801.0939 2
4 cutlery 35192 3
5 Chairs and Tables 54320 4
6 Assets (Cold Storage, induction) 38145 5
7 Electricity Charges 16152 6
8 Billing System 7
one-time investment (Computer,
printer) 28000
recurring(Printing paper, Software) 696

9 dress for employees 1500

10 Banner and menu (Main building) 12140 8
11 Miscellaneous cost 3000
12 Transportation 3000 monthly
total initial investment 4,69,946

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 Working note 1
no of per unit
Sr.no items unit cost references
1 chef 1 25,000 https://in.indeed.com/career/cook/salaries
the assumption is that the salary of the manager is 0.7 times
2 manger 2 15,000 of a chef
Cleaning ambitionbox.com/profile/housekeeper-salary/ahmedabad-
3 Staff 1 10,000 location

Working note 2
Sr.no Sr no sub-items per kg for 100 people per kg price price
1 Vegetables 7062.274
Panner 5 378 1890

potatoes 24.8 54.3 1346.64

oils 1 87 87
butter 1.5 490 735
species 89
Tomato 0.3 15 112.5
onions 0.8502 34.21 727.1336
Maida 5 115 575
miscellaneous 1500

2 Braveries 1350
Chass 25 15 375
Cold drinks 50 16.5 825
water bottles 25 6 150

3 Mukvas 0.8 272 272

4 Disposal Cost Plastic bags 60

5 Parcel cost 64
hand Bag 20 2.2 44

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 Fock and spoon 20 1 20

6 Extra item Salt, Paper 0.1 25 15

7 tissue paper 1000 469

Working note 4
Sr items quantity unit price cost
1 Table 8 3590 28720
2 Chairs 32 800 25600

Working note 5
Sr items quantity unit price cost
1 Cold Storage 1 24000 24000

2 Induction 5 2829 14145

Working note 6
Sr no Items sub-items no unit used per unit cost price
1 cooking
cold storage 55.2 10 552
induction 1260 10 12600
2 miscellaneous 3000

Working note 7
Sr
no Items price remarks
1 computer 25000 Second hand Refurbished computer
2 printer 3000
3 software 200 per month cost
4 Printing paper 496

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 Working note 8
Sr
no Items price remarks
1 nameplate 12000 Rs 20/square foot, banner size 3 ft by 6 ft
2 Menu 140 20 Qty

6.3) Depreciation

depreciation BV Rate

cutlery 35192 15%

Chairs and
Tables 54320 10%
Cold Storage 24000 25%
Induction 14145 15%
Billing System 28000 40%
Lights, fans 35,000 40%

dep for Cutlery

1 2 3 4 5
BV 35192 29913.2 25426.22 21612.29 18370.44
Dep @15 5278.8 4486.98 3813.933 3241.843 2755.567
Closing amount 29913.2 25426.22 21612.29 18370.44 15614.88

dep for Induction

1 2 3 4 5
BV 14145 12023.25 10219.76 8686.798 7383.778
Dep @15 2121.75 1803.488 1532.964 1303.02 1107.567
Closing amount 12023.25 10219.76 8686.798 7383.778 6276.212

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 dep for chairs and Table
1 2 3 4 5
BV 54320 48888 43999.2 39599.28 35639.35
Dep @10 5432 4888.8 4399.92 3959.928 3563.935
Closing amount 48888 43999.2 39599.28 35639.35 32075.42

dep for billing System

1 2 3 4 5
BV 28000 16800 10080 6048 3628.8
Dep @40 11200 6720 4032 2419.2 1451.52
Closing amount 16800 10080 6048 3628.8 2177.28

dep for cold storage

1 2 3 4 5
BV 24000 18000 13500 10125 7593.75
Dep @25 6000 4500 3375 2531.25 1898.438
Closing amount 18000 13500 10125 7593.75 5695.313

dep for Lights and Fans

1 2 3 4 5
BV 35,000 21000 12600 7560 4536
Dep @40 14000 8400 5040 3024 1814.4
Closing amount 21000 12600 7560 4536 2721.6

6.4) Terminal Values

• Assuming Cost of Capital = 14% and Growth rate=8%

Cash flow at end of year 5 = 19,28,362 Rs

Terminal value = 3,21,39,366.67 Rs

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