The Relax Inns rooms department has annual sales of $600,000 and variable costs of $180,000. The inns food department has annual sales revenue of $200,000 and variable costs of $160,000. The inns fixed costs are $220,000. The total sales revenue of the inn is $800,000 jointly.

a. Calculate the inns breakeven point, assuming the ratio of rooms sales to food sales remains constant at any level of total sales

b. The owners want to increase their restaurants sales revenue, and they plan to spend $1,000 on brochures to be displayed in the inns entry lobby and in the guest rooms. What level of incremental food sales must be achieved to cover the brochure cost? (Assume that room sales remain constant.)

c. If the inns owners want to increase operating income by $40,000 by increasing rooms occupancy rate, what is the incremental rooms sales revenue required to support the $40,000 increase to operating income? (Assume no effect on restaurant sales.)