Feasibility Report
Sample Solution
Fish & Chips on the Go: A Dream Takes Shape
Introduction:
The bitter aftertaste of cold fish and soggy chips at our graduation ceremony lingered, sparking an entrepreneurial fire within us. My colleague, Sarah, and I, fresh graduates from César Ritz Colleges (Brig) with a shared passion for delicious and well-prepared food, decided to take matters into our own hands. And so, "Fish & Chips on the Go" was born - a mobile food truck serving up fresh, crispy fish and chips with a smile.
Mission & Vision:
Our mission is to revolutionize the fast-food experience by offering gourmet quality fish and chips at an affordable price. We believe everyone deserves access to delicious, healthy, and convenient food options, regardless of their budget. Our vision is to be the leading provider of authentic and sustainable fish and chips, captivating taste buds and hearts across the city.
Financing:
To launch our venture, we raised capital through a combination of strategies. We issued common shares to friends and family who believed in our vision, attracting an initial investment of $20,000. Additionally, we secured a long-term note payable from a local bank for $50,000 to purchase the food truck and essential equipment.
Journal Entries:
Stage 1: Recording Transactions
| Date | Description | Journal Entry |
|---|---|---|
| Jan 1 | Issued 2,000 common shares for $10 per share. | Debit Cash $20,000 |
| Jan 2 | Secured a long-term note payable from the bank for $50,000. | Debit Cash $50,000 |
| Jan 5 | Purchased fish and chips ingredients for $8,000 on account. | Debit Inventory $8,000 |
| Jan 8 | Purchased cooking equipment for $15,000 and paid $5,000 in cash. | Debit Cooking Equipment $15,000 |
| Jan 10 | Purchased supplies (disposable plates, utensils, napkins) for $2,000 for cash. | Debit Supplies $2,000 |
| Jan 12 | Paid $2,000 in rent for the food truck parking space for January. | Debit Rent Expense $2,000 |
| Jan 15 | Purchased insurance for the food truck for the year at $3,600 and paid the full amount in cash. | Debit Prepaid Insurance $3,600 |
| Jan 17 | Paid salaries and wages of $4,000 to employees. | Debit Salaries/Wages Expense $4,000 |
| Jan 20 | Sold 500 fish and chips meals at $12 each. Received $6,000 in cash and $6,000 on account. | Debit Cash $6,000 |
| Jan 22 | Purchased additional inventory for $5,000 on account. | Debit Inventory $5,000 |
| Jan 25 | Paid $4,000 of the accounts payable due on January 5. | Debit Accounts Payable $4,000 |
| Jan 27 | Received $4,000 from customers who had previously purchased fish and chips on account on January 20. | Debit Cash $4,000 |
Note: This is a partial list of transactions for the month of January. More transactions may be added depending on the specific activities of the business.
These journal entries represent the initial recording of business transactions for Fish & Chips on the Go. The next stage will involve adjusting these entries for accruals and prepayments, followed by the preparation of the four main financial statements: Income Statement, Balance Sheet, Statement of Cash Flows, and Statement of Retained Earnings.