Bob owns a restaurant. The average price per order is $15 and the average variable cost per order is $9.The restaurant remains open 6 days a week for 50 weeks per year. The rent, utilities and other relatedexpenses are $8,000 per month. Bob pays $3,000 per month to his only employee in the restaurant. Bobalso spends $12,000 every year for renovation and maintenance. If Bob wants to earn a before tax profit of$8,000 per month, what should be the daily sales (in dollars) in the restaurant?

Contribution margin ratio is calculated by dividing contribution margin per unit by selling price…

Answered: Bob owns a restaurant. The average…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Aldo Redondo drives his own car on company business. His employer reimburses him for such travel at the rate of 52 cents per mile. Aldo estimates that his fixed costs per year-such as taxes, insurance, and depreciation-are $2,400. The direct or variable costs such as gas, oil, and maintenance-average about 21.5 cents per mile. How many miles must he drive to break even? (Do not round intermediate calculations. Roundup your answer to the next whole number.) Break even point miles
Bob wants to make a profit by renting out his basement unit. He believes he can rent for net of $800 per month after covering for any added monthly operating expenses. He needs to first take out a loan to renovate his basement. The loan is for $10000 with a 6% interest rate per year, compounding monthly. The loan has to be repaid in full within 6 years. Assuming the loan payments and rental income start at the same time (one month from now), how much monthly profit will Bob make over the next 6 years?
--you live in the mobile home for four years, but your roommate also pays you $3,000 a year, paid to you at the beginning of each year. The cost of the mobile home is $15,000, paid immediately. At the end of four years, you can sell the mobile home for $9,000. You have no maintenance on the home because you were such a smart manager Using Present Value, what is the cost of your college housing (positive or negative), assuming an interest rate of 8%?
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A couple found a house selling for $115,500.The taxes on the house are $1200 per year, and insurance is $360 per year. They are requesting a conventional loan from the local bank. The bank is currently requiring a 15% down payment and 3 points, and the interest rate is 10%. The couple's gross monthly income is $4850. They have more than 10 monthly payments remaining on a car, a boat, and furniture. The total monthly payments for these items is $420. Their bank will approve a loan that has a total monthly mortgage payment of principal, interest, property taxes, and homeowners' insurance that is less than or equal to 28% of their adjusted monthly income. Complete parts a) through g) below. Part 1 a) Determine the required down payment. The required down payment is $?
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