QUESTION 27 Dons M Brady s vested $1.200.000 in a small 280 seat) theatre Allot this mon should be considered her westment She would like to see a 10% after-tax retum on her investment in the coming year Dones faces a personal tax rate of 38% She expects the theatre seats to be sold at a 755 Capacity on average, and that in this year the theatre will be open on 130 nights There are many costs involved in running a theatre Estates indicate that variable costs will sero% of the reverse camed by the theatre Food costs would be Sataries 3420.000 Insurance 40,000 License 15,000 Us 110.000 Also, depreciation on the theatre building itself would be 10% of the building's 5000.000 current book value Part of Dons investment (included in the $1.200.000 mentioned above) in the theatre come through a bank loan of $250.000, on which she will be paying interest this year REQUIRED Poase calculate the total amount of revenue that this theatre will need to earn this year, in order to meet at costs and allow for Doris expected attor tax return (10 marks) b. Now that revenue has been calculated, please work out the tranche pricing for Dons, using the following data: 280 seats, selling at 75% capacity, open for 130 nights in the coming year, as stated above Tranches Tranche 1 paying 100% of top price 20% of tickets Tranche 2 paying 65% of top price 42% of tickets Tranche 3 paying 40% of top price. the remaining tickets (10 marks) Attach File Browse Local Fres Browse Content Collection