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The owner does not approve the budget in question (1). The owner believes he can accomplish the following:

Increase food revenue by increasing the number of guests consuming food by an additional 12,000 guests, with guest check average being $22.50

Increase beverage revenues by8%

Make food costs 30% from new food revenue

Make beverage costs 20% from the new beverage revenue

Make payroll costs 32% from the new revenue, but benefit costs will increase by6% over the ini­tial amount (shown in question 1).

Make other operating expenses 12% of new total revenue

Fixed costs will remain at the samedollaramount as in the original budget in question 1

Question: What is the revised estimate of budgeted profit before tax?



Food (original) $ _______

Additional food $ _______

New Food Revenue$ _______

Beverage (original) $ _______

Additional beverage 8% increase $ _______
New Beverage Revenue $ _______

New Total Revenue:$ _______

New Food Costs $ _______

New Beverage Costs $ _______

New Total Cost of Goods Sold$ _______

New Operating expenses:

New Payroll $ _______

New Benefits $ _______

New Other operating expenses $ _______

Total new operating expenses $ _______

Fixed costs $ _______

New Total costs$ _______

New Profit before Taxes $ _______

please give full explanation.
course : Cost control


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