QUESTION 27 Doris M Bradley has invested $1,200,000 in a small (280-seat) theatre. All of this monoyshould be considered her mvestment. She would like to see a 10% after-tax return on her investment in the coming year Doris faces a personal tax rate of 38% She expects the theatre soats to be sold at a 75% 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 Estimates indicate that variable costs wil uso 70of the revenue earned by the theatre Fixed costs would be Salaries $420,000 Insurance 40.000 License 15,000 Ulities 110,000 Also, depreciation on the theatre building itself would be 10% of the building's $800,000 current book vaso Part of Doris investment (included in the $1.200,000 mentioned above) in the theatre came through a bank loan of $250,000, on which she will be paying 5% interest this year REQUIRED Please calculate the total amount of revenue that this theatre will need to car this year, in order to meet all costs and allow for Dors' expected after tax return (10 marks) b. Now that revenue has been calculated please work out the tranche pricing for Doris, 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)