Appetizers

Entrees

Desserts

Beverages

Total sales

The Ivanhoe Inn is a restaurant that specializes in southwestern style meals in a moderate price range. Michael Jones, the manager of Ivanhoe, 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 Main entrees 60% 30% Desserts 10% 50% Beverages 20% 80% Michael is considering a variety of options to try to improve the restaurant's profitability. Her goal is to generate a target operating income of $140.400. The company has fixed costs of $1.216.800 per year. Michael believes the restaurant could greatly improve its profitability by reducing the complexity and selling prices of its entrees to increase the number of clients that it serves, and by more heavily marketing its appetizers and beverages. She is proposing to drop the contribution margin ratio on the main entrees to 10% by reducing the average selling price. She envisions an expansion of the restaurant that would increase fixed costs by 50%. At the same time, she is proposing to change the sales mix to the following: Percent of Total Sales Contribution Margin Ratio 60% Appetizers 20% Main entrees 30% 10% 10% 50% Desserts Beverages 4096 80% 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 if Michael's changes are implemented