Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

What is the level of sales needed to achieve a 10% return on an investment of $10,000,000 for a restaurant (the restaurant has main

What is the level of sales needed to achieve a 10% return on an investment of $10,000,000 for a restaurant (the restaurant has main products it sells: food, beverage and gift shop items) and cover all costs? Note the following information: Food generates 70% of sales and the food cost percent is 30. Beverages generate 25% of sales with a CMR of .82. Gift store items account for the rest of the sales with a CMR of .8. The fixed costs are $1,500,000 annually. What is the level of sales needed?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

To calculate the required sales level we need to first calculate the t... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Principles

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

10th Edition

1119491630, 978-1119491637, 978-0470534793

More Books

Students also viewed these Accounting questions