Mr. Thuet owns a food truck selling Vietnamese food around a university. His monthly fixed cost for operating the truck is $3,000, and variable cost is 70% of the revenue. The business generated revenue of $110,000 during the fi rst year of operation. He sets his second year’s earnings target before tax to be 5% of revenue.

REQUIRED

A. What is the earning before tax for the fi rst year’s operation?
B. What should the target revenue be in order to achieve his goal?
C. By how much will his revenue have to increase in the second year?