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Compute the revenues needed to earn the target net income

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Question: CVP analysis, income taxes. The Home Style Eats has two restaurants that are open 24 hours a day. Fixed costs for the two restaurants together total $430,500 per year. Service varies from a cup of coffee to full meals. The average sales check per customer is $8.75. The average cost of food and other variable costs for each customer is $3.50. The income tax rate is 36%. Target net income is $117,600.

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

2. How many customers are needed to break even? To earn net income of $117,600?

3. Compute net income if the number of customers is 170,000.

Reference no: EM131663584

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