From the course: Accounting Foundations: Budgeting

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Sales budget example for a service firm

Sales budget example for a service firm

From the course: Accounting Foundations: Budgeting

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Sales budget example for a service firm

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- To illustrate budgeting for a service firm, we're going to now operate a hotel where people who bought boats from our previous example, Wind River, go to recreate. Boulder View Inn is a small hotel located adjacent to a National Park in Southern Utah. Now, on a personal note, this is based on a real hotel owned by a person, an accounting professor, who actually taught me my first accounting class that I ever took. So this hotel's business is highly seasonal, with April through December being the peak or busy period, and January through March being vary slow. It's cold and snowy down there. Boulder View Inn has 10 rooms and rents them for an average of $150 per night during the peak period, and $100 per night during the slow period. Guests who stay at the hotel either pay cash or use credit cards, which for the hotel, are essentially the same as cash. The motel has a direct link with its bank that immediately deposits credit card receipts in Boulder View Inn's bank account, after…

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