Ronald has a Burger Restaurant located near a local University. The restaurant not only sells two...

 

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Ronald has a Burger Restaurant located near a local University. The restaurant not only sells two types of burgers: Beef Burger and Chicken Burger but also sell Pizza. Information relating to the three products for the next month follows: Expected sales (units) Sales price Variable cost Beef Burger 1,000 £18 £8 Chicken Burger 600 £20 £6 The company has monthly fixed costs of £12,000 and a tax rate of 20%. Pizza 400 £10 £7 Required: a) Compute the company's expected profit (net income) for the upcoming fiscal period. b) Compute the company's sale mix. c) Assuming a consistent sales mix, how many units of each product type must the company sell to break even? d) Assuming a consistent sales mix, if the company wishes to earn a net income of £40,000, how many units of each product type must be sold? e) Compute the margin of safety in both revenue £ and percentage terms. Ronald has a Burger Restaurant located near a local University. The restaurant not only sells two types of burgers: Beef Burger and Chicken Burger but also sell Pizza. Information relating to the three products for the next month follows: Expected sales (units) Sales price Variable cost Beef Burger 1,000 £18 £8 Chicken Burger 600 £20 £6 The company has monthly fixed costs of £12,000 and a tax rate of 20%. Pizza 400 £10 £7 Required: a) Compute the company's expected profit (net income) for the upcoming fiscal period. b) Compute the company's sale mix. c) Assuming a consistent sales mix, how many units of each product type must the company sell to break even? d) Assuming a consistent sales mix, if the company wishes to earn a net income of £40,000, how many units of each product type must be sold? e) Compute the margin of safety in both revenue £ and percentage terms.

Answer rating: 100% (QA)

d a Contribution margin from Beef burger sales units sales price 1000 188 10000 variable cost C... View the full answer