The Great Tamale Alternative 1- Food Truck After experiencing such great success with their food cart, Nathan and Cody are considering purchasing a food truck to serve other communities. This would allow the Great Tamale, GT, to reach even more customers in different geographic locations. There would be an increase in the selling price per plate. There will also be an increase in the fixed costs of $30,000 for advertising to inform the public of this change (this amount is already included below under Food Truck data). The financial information is presented below for this alternative as well as the original data. Assume 31,125 plates are sold for the food cart and 45,625 plates are sold for the food truck.

	Food Cart	Food Truck
Sales	$ 217,875.00	$365,000.00
Variable Cost	46,687.50	103,437.50
Contribution Margin	171,187.50	261,562.50
Fixed Cost	90,000.00	147,500.00
Income before taxes	81,187.50	114,062.50
income taxes (32% rate)	25,980.00	36,500.00
net income	55,207.50	77,562.50

8.) If sales greatly increase, which type (food cart or truck) would experience a greater increase in profit? What if sales declined -which product would experience a greater loss or reduction in income? Explain why. How does your calculation from (4) support your point?

9.) Thinking about sales, is there any day of the week or time of day when greater sales are expected? Which type is more sensitive to this occurrence? Which type is less sensitive to this occurrence? Which type is more advantageous and why? Is there anything else the company can do to manage the decline in sales that come with certain days and times?

10.)How do you recommend the company use the $30,000 advertising budget available under this scenario in order to achieve a maximum effect on their target audience?

11.)Compute the Profit Margin and Return on Assets for each scenario assuming average total assets of $500,000. Industry averages are 20% and 10% respectively