. P6.6 An owner invested $180,000 in a new family-style restaurant, of which $160,000 was...
50.1K
Verified Solution
Link Copied!
Question
Accounting
. P6.6 An owner invested $180,000 in a new family-style restaurant, of which $160,000 was immediately used to purchase equipment and $20,000 was retained for working cash. Estimates for the first year of business are as follows: Menu selling prices to be established to give a markup of 150% over cost of food sold Variable wages, 28% of sales revenue Fixed wages, $51,600 Other variable costs, 7% of sales revenue Rent, $36,000 Insurance, $4,800 Depreciation on equipment, 20% Return on investment desired, 12% Income tax rate, 30% The restaurant has 60 seats and is open 5 days a week for lunch and dinner only. Lunch sales revenue is expected to be 40% of total volume with 2 seat turnovers. Dinner revenue will be 60% of total volume, with 1.25 turnovers. Calculate the average check per meal period that will cover all costs, including desired return on investment
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
