What other considerations will george want to consider

Reference no: EM13480183

Dropping a segment - George's Grill analyzes profitability of three operating units: restaurant, bar, and billiards room. Revenues, variable costs, and attributable fixed costs (which can be avoided if the unit is eliminated) for each unit are as follows:

__________________________Restaurant Bar Billiards Rm

Revenue $320,000 $150,000 $40,000

Variable costs 120,000 35,000 10,000

Attributable fixed costs 80,000 25,000 15,000

George the owner, is considering converting the billiards area into an expanded bar area.

a)Ignoring remodeling costs, by how much will the bar segment margin have to increase for the grill's income to be at least as high as it is now?

b)What other considerations will George want to consider before making the decision to eliminate the billiards unit to expand the bar area?

Reference no: EM13480183

Questions Cloud

If the sales price of the used machine was 1200 the : 1 which of the following is not capitalized when a piece of production equipment is acquired for a factory?sales

A senior financial analyst with ace gadgets ag is : regression mastery problema senior financial analyst with ace gadgets ag is attempting to get a better grasp on sales

Determine the minimum floor price that shorewood shoes : special order pricing - shorewood shoes company makes and sells a variety of leather shoes for children.nbspnbspfor its

Topper corporation has 60000 shares of 1 par value common : topper corporation has 60000 shares of 1 par value common stock and 16000 shares of cumulative 7 100 par preferred

What other considerations will george want to consider : dropping a segment - georges grill analyzes profitability of three operating units restaurant bar and billiards

Varilux manufactures a single product and sells it for 10 : varilux manufactures a single product and sells it for 10 per unit. at the beginning of the year there were 1000 units

When fixed overhead is allocated to product the greater the : many accounting writers have emphasized the effect that the allocation of fixed overhead can have on managerial

The assembly division of davenport inc is bidding on an : make-or buy and relevant costs - the assembly division of davenport inc. is bidding on an order of 50000 smart phones.

Breakeven analysis and target profit taxes - patterson : breakeven analysis and target profit taxes - patterson parkas companys sales revenue is 30 per unit variable costs are

User Account

All Pages