2. You have the following annual information about Moonlight Bar and Grill, which consists of three different operating segments. Moonlight Bar and grill Income statement For the Year ended December 31, 2020 total dining Bar room Area outdoor Patio Sales Revenue $206,900 $156,800 $186,000 $549,700 Direct Costs 164,000 145.000 152.000 461,000 $11.800 $34,000 88,700 Contribution Income Indirect Costs $42.900 1 63.000 Operating $25.700 Income The owner wants to allocate indirect costs to each area based on square footage, to analyze how cach segment of the restaurant is performing. The dining room is 3,300 square feet, the bar area is 1,500 square feet and the outdoor patio is 1,200 square feet. required a. Allocate the indirect costs as indicated. uno The owner of the restaurant has an offer from a smoothie shop to rent the bar area for $7,000 per year. Rent does not include any of the indirect costs; they will have to be absorbed by the other segments. Prepare a revised income statement and advise the owner if this if an acceptable offer or not. Moonlight Bar and grill Income statement For the Year ended December 31, 2020 Sales Revenue Direct Costs Contribution Income Indirect Costs Income before Rent Rental Income I Operating Income indirect costs and an further c. The restaurant owner took another look at the various indirect costs and, on further analysis, discovered that some indirect costs would change, as shown below. Current Indirect Costs Costs if Bar Area rented $32,000 $29,000 Administrative Expense Advertising Expense 12,000 8,000 Insurance Expense 6,000 4,200 Repairs Expense 3,000 2,300 Utilities Expense 10.000 7.500 total $63.000 S51.000 If the bar area is not operated, it is estimated that outdoor patio sales revenue will decrease by 30% and direct costs will decrease by $20,000. Dining room sales revenue and direct costs will not be impacted. Prepare a revised income statement. With this new information, should the owner accept the offer? Moonlight Bar and grill Income statement For the Year ended december 31, 2020 total total $63.000 $51.000 If the bar area is not operated, it is estimated that outdoor patio sales revenue will decrease by 30 and direct costs will decrease by $20,000. Dining room sales revenue and direct costs will not be impacted. Prepare a revised income statement. With this new information, should the we accept the offer Moonlight Bar and grill Tacie statement For the lear ended december 31, 2020 dar Put total Sales Direct Case Income before Rent Rental Income Operating Income