Cost Estimation of a Retail Company

Name: ______________________________

Business: ___________________ Date: _______________________________

Economics of One Unit: Retail Company (Only complete if you are running a business, such as a
restaurant or retail store. You may complete this for one meal on your menu.)
Economics of One Meal or One Item Sold
Define the meal or item that you will be producing:
_________________________________________________________________________________________________________________________
_________________________________________________________________________________________________________________________
_________________________________________________________________________________________________________________________
_________________________________________________________________________________________________________________________
Selling price per meal/item

$ ___________________________________ A

Cost of goods sold per meal/item

$ ___________________________________ B

(Cost to you of producing one unit)

Gross profit per meal/item (A B)
(Gross profit of one unit)

$ ___________________________________ C

Name: ______________________________ Business: _______________________

Date: _______________________________

Startup Costs (These are the items you need to earn your first dollar of sales)
What are you estimated start-up costs? Itemize:
Item

Where Will you Buy This?

Cost

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Estimated Total Start-up Costs

$___________________________________

List your sources of financing below. Indicate with a check mark whether each source is offering equity, debt, or a
gift. Remember you will be starting with $50,000 that you were given from the bank as a loan. You will need
to pay back this loan on a monthly basis.
Amount
Personal Savings:
Relatives:
Friends:
Investors:
Grant:
Bank:
Other:
Total:

Equity
(Investment)

Debt (Loan)

$50,000

Gift

$____________________

If you receive equity financing, what percentage of ownership will you give up? _______________%
(Remember, the more ownership you give up, the less money you will make.)

If you receive debt financing, what is the maxium interest rate you will pay? ______________%

(Remember, the higher your interest rate, the more amount of money you will pay back. You want a relatively low
interest rate, most likely in the single digits.)

Name: ______________________________

Business: _______________________

Date: _______________________________

Operating Costs
Monthly Fixed Costs
Monthly Operating Costs include USAIIR: utilities, salaries, advertising, interest, insurance, and rent. In a
small business, many operating costs are usually fixed, although a few may be variable, depending on
your business.
Type of Fixed Costs
1. Rent or Mortgage
2. Electricity
3. Water
4. Telephone
5. Internet/ TV
6. Employee Salaries
7.
8.
9.
10.
11.
12.
13.
14.
15
Total Operating Costs

Monthly Fixed Cost

$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________
$ _______________________________

Sample Monthly Budget: Projected Income Statement for a Retail Company

Meals/Items Sold

Jan. Feb. Mar. Apr. May Jun.

2
4
6
8
8
16

Jul.
18

Aug. Sep. Oct.

20
8
8

Nov. Dec. Total

8
6
112

Meal/Item Selling Price

30

30

30

30

30

30

30

30

30

*Total Sales

60

120

180

240

240

Cost of Goods Sold per Meal/Item

17

17

17

17

*Total Cost of Meals/Items Sold

34

68

102

*Gross Profit

26

52

*Total Operating Costs

26

*Profit/(Loss)

30

30

30

30

480 540 600

240

240 240

180

3,360

17

17

17

17

17

17

136

136

272 306 340

136

136 136

102

1,904

78

104

104

208 234 260

104

104 104

78

1,456

26

26

26

26

26

26

26

26

26

312

26

52

78

78

182 208 234

78

78

78

52

1,144

17

26

17

26

17

*Taxes (25%)

$256

Net Profit:

$ 858

*Total Sales = Meals/Items Sold x Meals/Items Selling Price

*Total Cost of Meals/Items Sold = Meals/Items Sold x Cost of Goods Sold per Meal/Item
*Gross Profit = Total Sales Total Cost of Meals/Items Sold
*Profit/(Loss) = Gross Profit Operating Costs
*Taxes = Profit x 0.25

Monthly Budget: Projected Income Statement for a Retail Company

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Total
Meals/Items Sold
Meal/Item Selling Price
*Total Sales
Cost of Goods Sold per Meal/Item

*Total Cost of Meals/Items Sold

*Gross Profit

*Total Operating Costs

*Profit/(Loss)
*Taxes (25%)

Net Profit:

*Total Sales = Meals/Items Sold x Meals/Items Selling Price

*Total Cost of Meals/Items Sold = Meals/Items Sold x Cost of Goods Sold per Meal/Item
*Gross Profit = Total Sales Total Cost of Meals/Items Sold
*Profit/(Loss) = Gross Profit Operating Costs
*Taxes = Profit x 0.25

Name: ____________________________

Business: _______________________

Date: _______________________________

Sample Budgeted Yearly Income Statement for a Retail Business

Sales
Meals/Items Sold for one year
Meal/Item Selling Price for one
Total Sales for one year

Amount
112
$30
$3,360

Total Sales = Meals/Items Sold x

Meal/Item Selling Price

Costs
Cost of Goods Sold per Meal/Item
Total Cost of Meals/Items Sold

Amount
$17
$1,904

Gross Profit

$1,456

Total Operating Costs

Total Cost of Meals/Items Sold =

Meals/Items Sold x Cost of Goods Sold
per Meal/Item
Gross Profit = Total Sales Total Cost of
Meals/Items Sold

$312

Profit

Amount

Profit/(Loss) before Taxes

$1,144

Profit/(Loss) = Gross Profit Operating

Expenses

Taxes (25%)
Net Profit
Net Profit per Meal/Item

$286
$858
$7.66

Taxes = Profit x 0.25

Net Profit = Profit - Taxes
Net Profit per Meal/Item = Net Profit
Meals/Items Sold

Name: ____________________________

Business: _______________________

Date: _______________________________

Budgeted Yearly Income Statement for a Retail Business

Sales
Meals/Items Sold for one year
Meal/Item Selling Price for one
Total Sales for one year

Amount
_______________________________
$ ______________________________
$ ______________________________

Total Sales = Meals/Items Sold x

Meal/Item Selling Price

Costs
Cost of Goods Sold per
Meal/Item
Total Cost of Meals/Items Sold

Amount
$ ______________________________
$ ______________________________

Total Cost of Meals/Items Sold =

Meals/Items Sold x Cost of Goods Sold
per Meal/Item

Gross Profit

$ ______________________________

Gross Profit = Total Sales Total Cost of

Meals/Items Sold

Total Operating Costs

$ ______________________________

Profit

Amount

Profit/(Loss) before Taxes

$ ______________________________

Profit/(Loss) = Gross Profit Operating

Expenses

Taxes (25%)
Net Profit
Net Profit per Meal/Item

$ ______________________________
$ ______________________________
$ ______________________________

Taxes = Profit x 0.25

Net Profit = Profit - Taxes
Net Profit per Meal/Item = Net Profit
Meals/Items Sold

The rubric for the cost estimation is provided below. Please review this rubric while creating your budget
worksheets. If you have any questions, please contact your homeroom teacher.