Pricing can be fixed in at least 3 different ways, as follows.
1.Fixed Pricing: With fixed pricing, you would assign a price to your menu item, do this for each menu item and charge the customer on a “per-plate” basis or platter basis. Check if this model suits your catering assignment. Needless to say, in this case, profits would be determined also on a platter basis.
2.Tiered Pricing: This is very similar to fixed pricing but you can pass on the benefit of numbers to your customer. Essentially, more the expected turnout, lower will be the price of each item. You can have 3-4 such tiers with the minimum number of guests deciding each tier price. For example, for greater than 50 guests you could charge $20 for an item; for greater than 100 guests you could charge $18 for the same item and so on. This can be a very cost-effective model provided there is a great turnout of guests expected.
3.Customized Pricing: With the earlier methods, the customer knows upfront what your charges typically would be; however, with custom pricing, you have the freedom to decide the menu and pricing after the customer briefs you about all the details of the event. However, it is still beneficial to have a pricing guide ready for reference even for custom pricing. It will enable you to approximate the estimates better.
The above guidelines for determining the pricing for a menu are not stringent. It is just information about how pricing for a catering job is done. You will in fact need to be flexible if you’re serious about being in the business for a long time. There are many other factors that influence pricing such as the type of customer, your immediate competition in the same area and how established you are in the business. If you’re well-known for the quality of food, customers may not be very rigid about lowering your prices. On the other hand, if you have your close competitors quoting below your rates, you may have to negotiate harder so as not to lose the deal. You may have to provide additional “frills” to add value and differentiate your catering service from that of your rivals. If you’re very new to the business, you may well have to incur losses in your first few assignments just to prove your worth and establish your presence.
Thus, the ultimate profitable pricing strategy is a mix of several factors. Keep an open mind and be optimistic about the outcome. Once you know your market, your client base, etc., you will gradually work out the pricing strategy that is optimum for your catering business. Take each assignment as a challenge and be willing to learn from your mistakes as the catering business is certainly not for the faint-hearted. Many unexpected challenges may arise in the form of lesser than expected guest turnouts or shortage of food during service, weather delays, etc. Once you start your catering business, only experience can help you find your foothold in this industry. Read the rest of this entry »
If you wish to know how to calculate gross pay for employees hired on an hourly basis, then it is quite simple. You just need to take out the details of the number of hours devoted by the employee at the work and multiply that figure with the pay rate. The resultant amount will give you the gross pay for the contractual employees hired to work for a few hours for the company.
Then, the next step will include knowing how to calculate gross pay for the full-time salaried employees. For this, what figures you need is the annual pay package of the employee as well as the number of pay periods in a year. If you divide the annual salary figure with the number of pay periods, you will easily get the total gross income of the employee in the particular financial year.
Calculating net pay from gross pay and calculating gross pay from net pay is possible if you are aware of what are the mandatory deductions from the total income of the employee. If you wish to know how to calculate gross pay from net pay, then the things you will be needing is a calculator, your monthly salary slip and details of deductions such as tax deductions social security and health insurance amount paid by you. First of all, note down the net salary figure. Then, add all the deductions mentioned above and the resultant sum should further be added to the net income to give you the total gross income. Conversely, calculating net pay from gross pay is easy too. You again need the total of your monthly deductions and subtract the same from the gross income figure to get the net income.
Given below is the formula for gross payment.
Gross payment = Net payment + (social security + tax deductions + state taxes).
Given below is the formula for net payment.
Net payment = Gross payment – (social security + tax deductions + state and local taxes).
Importance of Gross and Net Income Read the rest of this entry »
The way to get started with forensic accounting is to earn a Bachelor’s degree in a field like accounting. This Bachelor’s degree is a regular four-year course that is available at most universities and colleges, and many universities are now offering this Bachelor’s degree as long distance learning program online.
Your next step would be to get prepared for the Certified Public Accountant exam in order to become a CPA. There are many online preparatory courses that are available to assist you in passing your exam.
Once you clear the CPA exam and earn a Bachelor’s degree in accounting, you can formally start practicing as a forensic accountant. However, in order to get started in the best way in the field (and of course, to earn the best salary) you should also consider going to graduate school. These days, a Master’s Degree in Forensic Accounting is also available in two forms – as the traditional Master’s degree and as an MBA program with a focus on Forensic Accounting. Earning this graduate degree will serve many purposes – one being that it can further train you to work in the field and will also serve to fulfill the educational requirements that are required for you to maintain your unique CPA status.
Apart from this, you will also be able to find extra coursework in other areas like criminal justice and law enforcement, which can be of great help, and legal training will also be of use. In addition, you could also go ahead and pursue a CFE accreditation or a Certified Fraud Examiner accreditation from the Association of Certified Fraud Examiners. This accreditation is nationally recognized and is very similar to the CPA exam.
Lastly, you could also pursue a CrFA accreditation or a Certified Forensic Accountant accreditation. This is a relatively new accreditation in the field of forensic accounting and most forensic accountants don’t have it, giving you an edge over the rest. While the industry continues to grow and expand, however, this accreditation may also become standard.
Yes, forensic accountants are experts that use a unique combination of experience and education to apply Read the rest of this entry »
As mentioned above, the hybrid method is an integration of several other methods. In the absence of an established hybrid method, businesses and companies basically formulate and improvise their own hybrid systems of accountancy. The existence of financial accounting software makes the formulation, development, improvisation and operation of a hybrid system quite easy. The following is the usual way in which the hybrid method works.
1.Anticipation and Costing: This is the first step. Any business organization needs to spend money to produce goods or provide services. The business then resorts to the costing of the product, that is, the expenditure is assessed, considering the per unit cost that the company incurs.
2.Actual Transaction, Journal, Ledger: In case if the transaction is sanctioned by the accounts and finance department, it is entered and recorded on a cash transactional basis. All the entries throughout the year go through the journal and ledger. In cases where the direct cash is used, a cash book entry is done.
3.Tax and Duties: This is a salient feature of the hybrid method. Every transaction is taxed or something needs to be paid to the government. Instead of ascertain tax at the year-end, it is calculated right during the transaction. Often a monetary provision for such tax is made as soon as the transaction is made.
4.Predictable Expenditures: This one is similar to the tax provision. There are certain expenditures which can be predicted. In such cases, cost analysis of expenditures such as raw material procurement, maintenance charges, power consumption, liability payoffs is done and provision for the same is made. This also helps in cost and profit ascertainment.
5.Inventory Analysis: The inventory and its worth is frequently analyzed as it is a crucial part of the asset side of the balance sheet.
6.Consolidation of Accounts: Consolidation of accounts is done by companies which own and operate several businesses and establishments. Different accounts, incomes, expenditures, assets and liabilities and other significant accounts are consolidated on a daily basis, so that management personnel can view the entire thing as a single individual company’s statements.
7.Cost Analysis Statements: Preparation of cost analysis statements is a salient feature where financial accounting and costing brilliantly mix. In a said company, there are several processes working at the same time. A statement indicating the expenditures of each process, per unit and per minute/hour is calculated. The total sales and profit figures of every process are also calculated and indicated on the statement. This is done on a daily basis.
8.Final Accounts: The final accounts are often prepared on a daily basis, these usually include an income and expenditure account, a balance sheet and a cash flow statement (which hints the rise and fall in cash flow). Now, these statements are strictly accrual in nature, and contain market prices of all assets and liabilities. The statement indicates the financial status of the company on a daily basis.
9.Indexes: Due to the highly dynamic nature of modern businesses, graphs indicating, three chief components, namely, assets, liabilities, income and expenditures, are updated every day. Read the rest of this entry »
1. Reduction in Tax Liability
Once the transferrer transfers his/her assets to an entity, his/her taxes on the estate are reduced. This is because, those assets will no longer be included in his personal assets anymore.
2. Reduction in Financial Liability
By creating an irrevocable trust, transferrer’s assets are protected from his/her financial liabilities. In case he/she defaults, or undergoes bankruptcy, the assets in the irrevocable trust cannot be confiscated for any legal action.
3. Free from Court Intervention
After the death of the transferrer, the court does not need to be involved in the process of transferring of assets, unless some dispute has occurred regarding it.
Cons of an Irrevocable Trust
1. Permanent Transfer of Estate
Because its a permanent transfer, a transferrer cannot change his/her decision of making the transfer.
2. Transferrer Immediately Loses His Right on the Assets
The transferrer loses his right on the assets mentioned in the trust from the moment he signs the trust/document.
3. Transferrer is Deprived of the Income Generated
Not only does the transferrer lose his ownership on the assets, but is also deprived of the income generated from it. Read the rest of this entry »