CA SE 8 An analysis of the 4C Company's restaurant costs for the Year 2007 revealed the following: Food and beverage: Directly variable with total sales revenue. Salary and wages: $156,400 fixed; the remainder are directly variable with total sales revenue. Laundry: Directly variable with total sales revenue. Kitchen fuel: $3,800 fixed; the remainder are directly variable with total sales revenue. China and tableware are directly variable with total sales revenue. Glassware is directly variable with total sales revenue. Contract cleaning is fixed. Licenses is fixed. Other operating expenses are directly variable with total sales revenue. Administrative and general is fixed. Marketing is fixed. Utilities costs: $3,100 fixed; the remainder directly variable with total sales revenue. Insurance is fixed. Rent is fixed. Interest is fixed Depreciation is fixed. a. Refer to the income statements in Cases 2 and 3 and calculate the restau- rant's total variable costs as a percentage of total sales revenue. b. Calculate the restaurant's total fixed costs. 366 CHAPTER 8 THE COST-VOLUME-PROFIT APPROACH TO DECISIONS c. Calculate the restaurant's breakeven sales revenue and also express the breakeven in terms of the number of guests (using the average check from Case 3). d. In Year 2007, the restaurant's operating income (before tax) is 6.9% of to- tal sales revenue. To increase the operating income to 10% of Year 2007's sales revenue, how many extra guests are required? CA SE 8 An analysis of the 4C Company's restaurant costs for the Year 2007 revealed the following: Food and beverage: Directly variable with total sales revenue. Salary and wages: $156,400 fixed; the remainder are directly variable with total sales revenue. Laundry: Directly variable with total sales revenue. Kitchen fuel: $3,800 fixed; the remainder are directly variable with total sales revenue. China and tableware are directly variable with total sales revenue. Glassware is directly variable with total sales revenue. Contract cleaning is fixed. Licenses is fixed. Other operating expenses are directly variable with total sales revenue. Administrative and general is fixed. Marketing is fixed. Utilities costs: $3,100 fixed; the remainder directly variable with total sales revenue. Insurance is fixed. Rent is fixed. Interest is fixed Depreciation is fixed. a. Refer to the income statements in Cases 2 and 3 and calculate the restau- rant's total variable costs as a percentage of total sales revenue. b. Calculate the restaurant's total fixed costs. 366 CHAPTER 8 THE COST-VOLUME-PROFIT APPROACH TO DECISIONS c. Calculate the restaurant's breakeven sales revenue and also express the breakeven in terms of the number of guests (using the average check from Case 3). d. In Year 2007, the restaurant's operating income (before tax) is 6.9% of to- tal sales revenue. To increase the operating income to 10% of Year 2007's sales revenue, how many extra guests are required