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  3. problem 1 what is the initial budgeted profit (bef

Problem 1 What is the initial budgeted profit (before tax) being planned by the Spartanland...

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Accounting

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Problem 1 What is the initial budgeted profit (before tax) being planned by the Spartanland Res- taurant for the current year, given the following information? a. Revenue (food) $975,000 Revenue (beverage) $135,000 36 31% of food revenue Food cost Beverage cost Labor cost (payroll) 34% of total revenue 22% of beverage revenue 18% of labor cost (payroll) Employee benefits Other operating expenses = 14% of total revenue 8% of total revenue All fixed costs b. The owner does not approve of the initial budget. Working together, the owner and manager believe they accomplish the following: can Implement marketing plans to increase the number of guests consuming food by additional 12,000 (guest check average = $22.50) an Increase beverage revenues by 8% over initial estimates Decrease food costs to 30% Decrease beverage costs to 20% Decrease payroll costs to 32% (but benefit costs will increase by 6% over the initial budget because of new payroll taxes not included in the original budget) Decrease operating expenses to 12% of total revenue (Fixed costs will remain at the same dollar amount as in the original budget.) . What is the revised estimate of budgeted profit before tax

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