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  3. budget inn and suites sets its adr to be $115 and

Budget Inn and Suites sets its ADR to be $115 and only has one room...

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Accounting

Budget Inn and Suites sets its ADR to be $115 and only has one room type. The variable costs per room are $25. All the fixed costs (rent, wages, and others) total $6,500 a month. In the previous month, Budget Inn sold 2,250 rooms. (Income tax rate is 20%).

Please conduct analyses to answer the following questions.

How much net income after tax did the business earn in the previous month?

In the coming month, your target net income to be $185,000 after paying taxes. To achieve this goal, how many rooms you need to sell next month?

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