City Hot ESTION5 ou hive the 1 1 in pe o i ns about the costs in a ast ood resta

Question

City Hot ESTION5 ou hive the 1 1 in pe o i ns about the costs in a ast ood restaurant for the next year Net incon e AT requied is 18% ont oquity investment of $240,00 The i come tax rate is 28% Deprec ali on restau at I mle hi and quip ment is 20% o the esint book wal eo S 112.000 Interest on the bank loan s 12% of the present balance o d of S50 ther costs are nsurance expense $4,500 3,200 $12,600 $1,200 $48,900 35% of total sales revenue 33% of total sales revenue 8% of total sales revenue tilities expense salary expense ost of Sales (food and beverage expenses) ther variable expenses e the sales revenue required to cover all the restaurant expenses next year S Calculat ) Calculate the restauran's overall average chec O Sales Revenue: $1,054 524 k, given that the restaurant has 132 seats and that is is open sik days a week for 52 weeks of the year, and that 2 2 seat overs Overall Average Check: $11.64 O Sales Revenue: $661,667 Overall Average Check: $7.30 O Sales Revenue: $208,947 Overall Average Check $2.31

Explanation / Answer

Let sales revenue = X

Sales = 158800 / ( 1 - 0.76) = 661667

Restaurant overall average check = 661667 / (132*6*52*2.2) = 7.30

ANSWER = b) Sales revenue= $661677;

Overall average check = $7.30

Insurance expense 4500 Licenses expense 3200 Utilities expense 12600 Maintenance expense 1200 Management salary expense 48900 Depreciation exp 22400 112000*0.20 Interest on bank loan 6000 50000*.12 Profit before tax 60000 240000*.25 Total Expense 158800

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