Share
Explore BrainMass

Tools and Components of Sales and Forecasting

1. What are components of cost of sales? How is cost of sales calculated? How does cost of sales affect a food and beverage operations profitability? What areas would you examine to improve cost of sales?

2. What tools are available for managers to use when forecasting? What role does forecasting play in managing a food and beverage operation? What operational variables must a manager consider? What is the difference between short- and long-term forecasting?

Solution Preview

1. What are components of cost of sales? How is cost of sales calculated? How does cost of sales affect a food and beverage operations profitability? What areas would you examine to improve cost of sales?

The components of cost of sales (e.g for the beverages) include raw materials (principally sweeteners, soft drink concentrate, packaging materials and water), depreciation expenses attributable to the company's production facilities, wages and other employment expenses associated with the production labor force, and certain overhead expenses. Cost of sales refers to the cost of all the goods that we sold this year. For example, we may have sold 100 units of beverage this year at $4 each, and these 100 units that we sold cost us $3 each originally. So our sales would be $400 and our cost of sales) would amount to $300. This would result in a gross profit of $100 (sales minus cost of sales). Cost of goods sold is not the same as ...

Solution Summary

The solution discusses the tools and components of sales and forecasting.

$2.19