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Discuss the implications of applying cvp analysis

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Question - The manager of a 60-seat restaurant wants to convince the owner that a new investment in bar equipment can be rapidly paid off. As such, he decides to change the restaurant's contribution margin percentages by lowering it for food and increasing it for beverages. Discuss the implications of applying CVP analysis in this situation. How would you advise the restaurant owner? What effect, if any, would your advice have on targeted profit levels of revenue? Explain your answer.

Reference no: EM133070157

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