Nick Strizzi owns and operates a pizza delivery and take-outrestaurant. In 2013, he sold 100,000 pizzas at an averageselling price of $15.00. The cost to make each pizza is $3.00for cheese, $2.50 for spices, and $3.75 for the crust and otheringredients. The annual cost of operating the business is asfollows:$ 55,000$230,000$ 15,000$ 30,000$150,000RentSalariesInsuranceAdvertisingCar expensesThe income tax rate for 2013 was 18%. Nick is preparing aprojected incomeassumptions are as follows:statementfor 2014. The planningIncrease in number of pizzas sold10%Selling price per pizza$ 16.00Increase in cost of cheese8%Increase in cost of spices5%Increase in cost of crust and other9%ingredientsAnnual rent$65,000Increase in salaries12%Increase in insurance costs10%Advertising costsIncrease in car expenses$35,00015%Income tax rate17%309Questions1. Prepare Nick Strizzi's statement of income for 2013and 2014.2. Calculate Nick Strizzi's return on revenue ratios for2013 and 2014.

Statement of Income shows all revenues and expenses of the business and at the end it shows net…

Nick Strizzi owns and operates a pizza delivery and take-out restaurant. In 2013, he sold 100,000 pizzas at an average selling price of $15.00. The cost to make each pizza is $3.00 for cheese, $2.50 for spices, and $3.75 for the crust and other ingredients. The annual cost of operating the business is as follows: $ 55,000 $230,000 $ 15,000 $ 30,000 $150,000 Rent Salaries Insurance Advertising Car expenses The income tax rate for 2013 was 18%. Nick is preparing a projected income statement for 2014. The assumptions are as follows: planning Increase in number of pizzas sold Selling price per pizza 10% $ 16.00 Increase in cost of cheese 8% Increase in cost of spices 5% Increase in cost of crust and other 9% ingredients Annual rent Increase in salaries $65,000 12% Increase in insurance costs 10% Advertising costs Increase in car expenses $35,000 15% Income tax rate 17% 309 Questions 1. Prepare Nick Strizzi's statement of income for 2013 and 2014. 2. Calculate Nick Strizzi's return on revenue ratios for 2013 and 2014.

Nick Strizzi owns and operates a pizza delivery and take-out restaurant. In 2013, he sold 100,000 pizzas at an average selling price of $15.00. The cost to make each pizza is $3.00 for cheese, $2.50 for spices, and $3.75 for the crust and other ingredients. The annual cost of operating the business is as follows: $ 55,000 $230,000 $ 15,000 $ 30,000 $150,000 Rent Salaries Insurance Advertising Car expenses The income tax rate for 2013 was 18%. Nick is preparing a projected income statement for 2014. The assumptions are as follows: planning Increase in number of pizzas sold Selling price per pizza 10% $ 16.00 Increase in cost of cheese 8% Increase in cost of spices 5% Increase in cost of crust and other 9% ingredients Annual rent Increase in salaries $65,000 12% Increase in insurance costs 10% Advertising costs Increase in car expenses $35,000 15% Income tax rate 17% 309 Questions 1. Prepare Nick Strizzi's statement of income for 2013 and 2014. 2. Calculate Nick Strizzi's return on revenue ratios for 2013 and 2014.

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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