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How many customers are needed to break even

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Question - The Rapid Meal has two restaurants that are open 24 hours a day. Fixed costs for the two restaurants together total $446,000 per year. Service varies from a cup of coffee to full meals. The average sales bill per customer is $8.50. The average cost of food and other variable costs for each customer is $3.40. The income tax rate is 30%. Target net income is $116,200.

Required -

1. Compute the revenues needed to earn the target net income.

2. How many customers are needed to earn net income of $116,200? How many customers are needed to break even?

3. Compute net income if the number of customers is 155,000.

Reference no: EM132834062

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