What is the annual revenue required to earn desired profit

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Question - You are considering opening a pizzeria with 60 seats. You plan to open every day. You have $85,000 to invest and are in a 13% tax bracket. You want an after tax return on your investment of 15%. You have researched this idea and come up with the following expenses:

Management salary $45,000

Depreciation 12% on equipment (cost: $20,000)

Utilities $420 per month

Food expense 38%

Other expenses 12%

Interest on loans 6.5% on a balance of $55,000

Wage expense 27%

Required - What is the annual revenue required to earn the desired profit?

Reference no: EM132973820

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