Khana’s Coffee House Case Study

  Table of contents

Introduction:

Khana’s is a small local coffee house situated in khilgoan taltola. The interest by consumers in the coffee house industry is sweeping the country. Khana’s will provide a friendly, comfortable atmosphere where the customer can receive quality coffee and service at a cheapest price. The coffee house will offer a variety of choices to the customers. All sorts of coffee will be offered. Khana’s is operating as a Sole Proprietorship. It is a roadside coffee house. Customers can easily take coffee on the go. This coffee shop has a small place with two tables and eight chairs where customers can sit and have their conversation over a cup of coffee.

Khana’s is maintaining by its owner and two sales man. For the last two years this coffee house is serving its quality coffee to its customers surrounding the local area in a really cheapest price. They conduct all their sales on monthly basis and also collect the payments on cash. They don’t have any Accounts Receivable. They also pay for their direct materials on cash so for that also they don’t have any Accounts Payable.

NATURE OF THE BUSINESS

The nature of the business of a coffee stall is just like the proprietorship. In proprietorship, he has to bear all the loss and get all the profit.

Sales Budget

Components:

1. Budgeted sales for the quarters are:

     Quarter 1 = 6550 units,  

           Quarter 2 = 4250,  

           Quarter 3 = 6350,    

           Quarter 4 = 7750   

     2. The selling price per unit is 50 Taka.

     3. All sales are made in cash, there are no on hand sales.

                                       The Production Budget

The production is on daily instant order basis. So there are no beginning or ending production inventory.

Direct Materials Budget