Homework Help Question & Answers

McDowell’s hamburger restaurant chain had revenues of $5,844,800 last year (year 1) and $7,504,500 this year....

McDowell’s hamburger restaurant chain had revenues of $5,844,800 last year (year 1) and $7,504,500 this year.

1. What is the year on year sales growth? 28.4%
2. $445,593 of this year’s revenue came from the opening of a new location. What is your same stores sales growth? 20.77%
3. Why is it important to calculate same stores sales growth? Why not just use year on year instead?
4. Assume the company’s growth is the same for each year. What is the company’s projected sales in year 4?
5. Your year 6 actual sales volume is $10,545,700. What is your CAGR over the 6 years?

need help with the last three.
0 0
Next > < Previous
ReportAnswer #1

1. Sales growth= Sales of this year-Sales of last year/Sales of last year= 7504500-5844800/5844800= 28.4%

  • 2. Revenue from opening new location= 445593
  • Revenue in current year on same stores= 7504500-445593= 7058907
  • Growth rate= 7058907-5844800/5844800= 20.77%

3. It is important to calculate same years sales growth as it serves an important metrics for various decisions in the organisation. Even manager's bonus is linked to the sales growth. Sales growth rate gives an evidence if the sales goals are met which is not possible when year on year sales are analysed

4. Assuming company's growth is same for ech year i.e. 28.4%. Sales in Year 1= 5844800, sales in year 4= 5844800(1.284)^3= $12372707

5. CAGR= (Sales in year6/Sales in year 1)^1/t-1=(10545700/5844800)^1/6-1= 10.35% approx

Know the answer?
Add Answer to:
McDowell’s hamburger restaurant chain had revenues of $5,844,800 last year (year 1) and $7,504,500 this year....
Your Answer: Your Name: What's your source?
Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • A restaurant chain had $684,000 worth of sales revenue last year. It also had costs of...

    A restaurant chain had $684,000 worth of sales revenue last year. It also had costs of $315,000, depreciation expense on its equipment of $42,000, interest expense of $35,000, and a corporate income tax rate of 35 percent. The restaurant chain paid out $78,000 in cash dividends. Calculate the restaurant chain's addition to retained earnings for the year? Multiple Choice $111,800 $153,800 $100,620 $188,800 $146,800

  • Westerville company reported the following results from last year's operations

    Westerville Company reported the following results from last year’s operations:   Sales $ 1,400,000       Variable expenses 680,000       Contribution margin 720,000       Fixed expenses 440,000       Net operating income $ 280,000       Average operating assets $ 875,000     This year, the company has a $300,000 investment opportunity with the following cost and revenue characteristics:   Sales $ 480,000   Contribution margin ratio 80 % of sales   Fixed expenses $ 336,000 The company’s minimum required rate of return is 15%. Required: 1. What is last year’s margin?        2. What...

  • Westerville Company reported the following results from last year’s operations: Sales $ 1,200,000 Variable expenses 320,000...

    Westerville Company reported the following results from last year’s operations: Sales $ 1,200,000 Variable expenses 320,000 Contribution margin 880,000 Fixed expenses 640,000 Net operating income $ 240,000 Average operating assets $ 600,000 At the beginning of this year, the company has a $150,000 investment opportunity with the following cost and revenue characteristics: Sales $ 240,000 Contribution margin ratio 50 % of sales Fixed expenses $ 84,000 The company’s minimum required rate of return is 15%. 5. What is the turnover...

  • Onlywhiteshirts Inc. sells one product: white shirts. It had revenues of $50 million last year. This...

    Onlywhiteshirts Inc. sells one product: white shirts. It had revenues of $50 million last year. This year it expects to sell 4% more shirts and it plans to raise the price of its shirts by 4%. At what rate will sales rise this year, compared to last year? (Express your answer in percentage form rounded to two decimal places.)

  • Marketing Research Interpretation Scenario Wendy's is a restaurant chain that is immersed in the Fast Food...

    Marketing Research Interpretation Scenario Wendy's is a restaurant chain that is immersed in the Fast Food Restaurant Industry where we can find companies that compete in different segments, being Burger, Sandwich, Snacks/Beverages, Chicken and Pizza the most important. Each restaurant is in competition with other food service operations within some geographical area. These quick service restaurants are highly competitive and include well established competitors. Quality, variety, convenience, price and value perception of food products offered, locations, quality and speed of...

  • A buyer for a chain of garden stores is deciding on prices for the chain’s extensive line of potted plants. Management has indicated that the target gross margin for these items should be 40 percent....

    A buyer for a chain of garden stores is deciding on prices for the chain’s extensive line of potted plants. Management has indicated that the target gross margin for these items should be 40 percent. Last year, markdown reductions amounted to 17 percent of the total dollar sales revenue received from potted plants. If the buyer assumes this year’s markdown reductions as a percentage of intended revenue will be similar to last year’s, what initial gross margin should she apply...

  • Westerville Company reported the following results from last year’s operations: Sales $ 1,800,000 Variable e...

    Westerville Company reported the following results from last year’s operations: Sales $ 1,800,000 Variable expenses 435,000 Contribution margin 1,365,000 Fixed expenses 1,005,000 Net operating income $ 360,000 Average operating assets $ 1,200,000 At the beginning of this year, the company has a $300,000 investment opportunity with the following cost and revenue characteristics: Sales $ 360,000 Contribution margin ratio 70 % of sales Fixed expenses $ 216,000 The company’s minimum required rate of return is 10%. 11. What is last year’s...

  • Westerville Company reported the following results from last year’s operations: Sales $ 1,000,000 Variable expe...

    Westerville Company reported the following results from last year’s operations: Sales $ 1,000,000 Variable expenses 300,000 Contribution margin 700,000 Fixed expenses 500,000 Net operating income $ 200,000 Average operating assets $ 625,000 At the beginning of this year, the company has a $120,000 investment opportunity with the following cost and revenue characteristics: Sales $ 200,000 Contribution margin ratio 60 % of sales Fixed expenses $ 90,000 The company’s minimum required rate of return is 15%. Foundational 10-4 a. What is...

  • The Vintage Restaurant, on Captiva Island near Fort Myers, Florida, is owned and operated by Karen Payne. The restaurant just completed its third year of operation. Since opening her restaurant, Karen...

    The Vintage Restaurant, on Captiva Island near Fort Myers, Florida, is owned and operated by Karen Payne. The restaurant just completed its third year of operation. Since opening her restaurant, Karen has sought to establish a reputation for the Vintage as a high-quality dining establishment that specializes in fresh seafood. Through the efforts of Karen and her staff, her restaurant has become one of the best and fastest growing restaurants on the island. To better plan for future growth of...

  • Maslyn Manufacturing has projected sales of $148.2 million next year. Costs are expected to be $82.6...

    Maslyn Manufacturing has projected sales of $148.2 million next year. Costs are expected to be $82.6 million, and net investment is expected to be $16.6 million. Each of these values is expected to grow at 14 percent the following year, with the growth rate declining by 2 percent per year until the growth rate reaches 6 percent, where it is expected to remain indefinitely. There are 7.1 million shares of stock outstanding and investors require a return of 13 percent...

Free Homework App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.