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The Grand Inn is a restaurant in Flagstaff, Arizona. It specializes in southwestern style meals in a moderate price range. Paul Weld, the manager of

The Grand Inn is a restaurant in Flagstaff, Arizona. It specializes in southwestern style meals in a moderate price range. Paul Weld, the manager of Grand, has determined that during the last 2 years the sales mix and contribution margin ratio of its offerings are as follows.

Percent of Total Sales

Contribution Margin Ratio

Appetizers 15 % 70 %
Main entrees 50 % 25 %
Desserts 10 % 80 %
Beverages 25 % 80 %

Paul is considering a variety of options to try to improve the profitability of the restaurant. His goal is to generate a target net income of $115,000. The company has fixed costs of $1,142,000 per year.

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