Question

In: Accounting

The Red Fusion​, a local Thai​ restaurant, expects sales to be $ 300 comma 000 in...

The Red Fusion​, a local Thai​ restaurant, expects sales to be $ 300 comma 000 in January. Its average customer restaurant bill is $ 25. Only 40 % of the restaurant bills are paid with​ cash; 30 % are paid with credit cards and 30 % with debit cards. The transaction fees charged by the credit and debit card issuers are as​ follows:
Credit​ cards: $ 0.25 per transaction​ + 5 % of the amount charged
Debit​ cards: $ 0.45 per transaction​ + 4 % of the amount charged

How much of the total sales revenue is expected to be paid in​ cash?
2.
How many customer transactions does the company expect in​ January?
3.
How much of the total sales revenue is expected to be paid with credit​ cards?
4.
How many customer transactions will be paid for by customers using credit​ cards?
5.
When budgeting for​ January's operating​ expenses, how much should the restaurant expect to incur in credit card transaction​ fees?
6.
How much of the total sales revenue is expected to be paid with debit​ cards?
7.
How many customer transactions will be paid for by customers using debit​ cards?
8.
When budgeting for​ January's operating​ expenses, how much should the restaurant expect to incur in debit card transaction​ fees?
9.
How much money will be deposited in the​ restaurant's bank account during the month of January related to credit and debit card​ sales? Assume the credit and debit card issuers deposit the funds on the same day the transactions occur at the restaurant​ (there is no processing​ delay).
10.
What is the total amount of money that the restaurant expects to deposit in its bank account during the month of January from​ cash, credit​ card, and debit card​ sales? Again assume the credit and debit card issuers deposit the funds on the same day that the transaction occurs.

Solutions

Expert Solution

Amount charged means amount charged by the Red Fusion from customers.

Hope you understood the solution. If you have any doubt please leave your doubt in the comment section so that I can clarify your doubt.

Thank you.

ekkarill92 answered 2 years ago
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