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Lyric Dinner Case Study

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LYRIC DINNER THEATER CASE STUDY Contents 1. Do you think Deborah made a good career decision to take the job of general manager at Lyric? 3 2. Can this business be profitable? If not, why not? If yes, what needs to be done to achieve profitability? 5 3. What specific actions should Deborah take? 9 1. Do you think Deborah made a good career decision to take the job of general manager at Lyric? In my opinion, from a career point of view Deborah made a high risk decision by joining Lyric Dinner Theater. She had just completed her MBA from Harvard Business School in June 2009 and had various job opportunities to choose from; including the US office of an Israeli high-technology equipment firm and a major advertising firm …show more content…

This is important because in the cash system, the outflows are more on need to pay a supplier basis and not what is actually consumed. * For ‘Food Purchased’ and ‘Supplies’, the ratio is considered with Box Office Sales (This will also provide a higher than actual figure, as the actual food costs had reduced in 2010 as a result of the new chef being employed. However, it is done to ensure a conservative basis for calculating profits) * For ‘Liquor Purchased’, the ratio is considered with Liquor & Miscellaneous Sales * It is assumed that ‘Show expenses’ has to be paid immediately – so it is taken as given in the case for YTD February * It is assumed that ‘General Overhead Expenses’ will remain same in 2010, as it was for 2009; and the expenses can be accrued proportionately over 12 months. This is important because in the cash system, the outgoings for items like rent is overstated (in initial months) and for items like depreciation is understated (in initial months) * ‘Other Income’ has been ignored to follow conservative accounting policy and ensure that profits are not overstated (The calculations are in the attached excel sheet.) After

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