Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The date is January 1, 2021 and Party Town (PT) has just won the bidding process to host a party on March 30, 2021.
The date is January 1, 2021 and Party Town (PT) has just won the bidding process to host a party on March 30, 2021. PT is charging their guests an admission fee of $100 per person. PT has rented a banquet hall for $900 that will accommodate up to 100 people. PT has contracted with Cathy's Catering to cater the party for $10 per person that attends (up to 100). PT estimates that they will have $5 of depreciation expense from January 1, 2021 through March 31, 2021. Do not round the units (people) to the nearest person. Round to two decimals. Additional Information: At the party, it is estimated that 80% of the guests will pay at the door in cash and 20% will pay between April 1, 2021 and April 30, 2021. The estimated party guests are 80. Cathy's Catering will be paid half their fee (Cathy requires the estimate to be the max of 100 people) an March 1, 2021 and the balance will be paid on April 15, 2021 The banquet hall will be paid in full on March 1.2021 What is the budgeted margin of safety in sales dollars? Choose closest answer. $11,000 $5,000 $8,995 $6,995
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started