The Joneses provide you with the following estimates:
Projected average revenue, including beverages and desserts $ 45 per meal
Average cost of food $ 15 per meal
Chef’s, waiters, and dishwasher salaries $ 5,100 per month
Rent (building and various equipment) $ 4,000 per month
Cleaning (both linen and premises) $ 800 per month
Replacement of dishes, cutlery, glasses, etc $ 300 per month
Utilities, advertising, and telephone $ 2,300 per month
YOU ARE REQUIRED to:
- Identify for them the annual number of meals needed to breakeven and the sales revenue to breakeven.
- Identify for them how many meals the Joneses must serve to make a profit of $ 75,600 (the desired profit level) in year One.
- Identify THREE (3) major factors the Joneses should consider before they make their decision as to whether to open the restaurant or not.
