Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Calculate the total restaurant sales and the sales of each product line that would be necessary in order to achieve the desired target operating

1. Calculate the total restaurant sales and the sales of each product line that would be necessary in order to achieve the desired target operating income.
image text in transcribed
image text in transcribed
The Sheridan Inn is a restaurant that specializes in southwestern style meals in a moderate price range. Richard Miller, the manager of Sheridan, has determined that during the past two years the sales mix and contribution margin ratio of its offerings have been as follows: Percent of Total Sales Contribution Margin Ratio 10% 60% Appetizers 30% 60% Main entrees 50% 10% Desserts 80% 20% Beverages Richard is considering a variety of options to try to improve the restaurant's profitability. Her goal is to generate a target operating income of $156,000. The company has fixed costs of $1,271,400 per year. Calculate the total restaurant sales and the sales of each product line that would be necessary in order to achieve the desired target operating income. Appetizers $ Entrees $ $ Desserts $ Beverages $ Total sales

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions

Question

l describe characteristics of learning organizations

Answered: 1 week ago