Question
The Express BanquetExpress Banquet has two restaurants that are open 24 hours a day. Fixed costs for the two restaurants together total $450,000 per year.
The
Express BanquetExpress Banquet
has two restaurants that are open 24 hours a day. Fixed costs for the two restaurants together total
$450,000 per year. Service varies from a cup of coffee to full meals. The average sales check per customer is
$ 8.00.The average cost of food and other variable costs for each customer is $ 3.20 The income tax rate is
30%. Target net income is $105,000.
Requirements
1. Compute the revenues needed to earn the target net income.
2. How many customers are needed to break even? To earn net income of $105,000?
3. Compute net income if the number of customers is 165,000.
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