Case Analysis Hotel has operated for over ten years and sales exceed targets in all their operations, including their in-house restaurant. To optimize revenue from the food and beverage operations, the General Manager is considering to expand the restaurant since there islocation. additional space adjacent to the current . The expansion will allow for an additional 50 seats to the existing 70 seat restaurant, which is open for Breakfast, Lunch and Dinner. This would also, of course, require many other costs and would generate additional benefits. The General Manager, in consultation with the owner, decided to complete a Cost-Benefit Analysis (CBA) to explore her choices. Assumptions: $1,630,000 Current annual restaurant revenues 13% Estimated increase in annual revenue due to this increased capacity $17.30 Servers' hourly wage 26 Hours worked per week by each new server $2,300 Recruitment cost (flat amount regardless of how many servers) 23 Number of hours of training per each new server 3 Number of new servers hired $630 Orientation cost per new server $230 Additional monthly cost due to increased utilities costs 780 square feet of additional space being added $15,673 Weekly cost due to downtime during construction 5 Amount of time (weeks) it will take to complete the construction $123,000 Flat cost for materials and labour, re. adding the additional space 3 Number of additional POS terminals $63,000 Cost of furniture for the customer area and for supporting the POS terminals $1,300 Annual cost of an additional licence for each new POS terminal Your estimates of additional costs & benefits. Include as many reasonable additional costs and benefits that you anticipate the hotel will incur as a result of expanding their restaurant area. The figures given above represent many of the costs and benefits involved in this project, but definitely not all. Answer the following questions: 1. Include as many reasonable additional costs that you anticipate the hotel will incur as a result of (12 marks) expanding their restaurant area. The figures given above represent many of the costs involved in this project, but definitely not all. 2. Include as many reasonable additional benefits that you anticipate the hotel will incur as a result of (12 marks) expanding their restaurant area. The figures given above represent many of the benefits involved in this project, but definitely not all. 3. Determine the Payback Period in terms of years and/or months by using the CBA template. (24 marks) 4. Should this expansion be undertaken? Explain your answer based on your analysis of the CBA. (12 marks) Total = 60 marks