Use of Financial Statements in Food and Beverage Operation Assignment

Use of Financial Statements in Food and Beverage Operation - Assignment ExampleTax authorities need to estimate the pecuniary line of reasonings to take in the level of taxation to be applied to the railway line. The balance sheet is an grave financial statement that indicates the position of a food and beverage enterprises assets and liabilities as well as the shargonholders equity. In a balance sheet, the difference between assets and liabilities equals equity (Reid & Botanic, 2006).Income statements contain operating costs that are categorised as direct and indirect costs. Direct costs are those incurred in running specific functions much(prenominal) as casual labour and raw material supplies while indirect costs are non-specific expenses that tin the entire business such as depreciation, cleaning and general office supplies. These expenses are considered in find out the shareholder incomes per share. The revenue earned in a particular period of time is also contained in the income statements. They help the owner of the food and beverage operation to know if the business made a pay as well as whether the profits attained conformed to the targets set for the business. Income statements also help the owner to determine whether the profits decreased or increased compared to earlier periods. If the owner is not the manager, he/she can manipulation the income statements to appraise the restaurant managers performance. Cash-flow financial statements are important in tracking the figurehead of monies in and out of the business. They can be used to identify irregular payments and also to track the businesss capacity to settle outstanding bills. The owner of the food and beverage operations can evaluate the net cash increase or decrease to determine if the business is achieving the growth strategy (Bowie & Buttle, 2004).It is important to recognize and appraise the need for a product in the company. The product may be necessitated by finished stock, inno vations or demand from customers. Specifications should be done to ensure that all the necessary details are taken care of to offer customers the best value.