Assessment 1 Part 2 – CVP AnalysisYou are assisting management consider different cost and pricing strategies. Considerthe following data and report to management your findings.1. The cocktail bar in the Le Cordon Bleu hotel currently has sales revenue of$650,000.00 per year. Beverage costs amount to 40% and other variable costs atthis level of revenue amount to 10%. Fixed costs are $170,000pa.You are required to show all relevant formula and calculations using a professionallayout as explained during class tutorial sessions. Use Excel and use wholenumbers. Percentages where shown should be 1 decimal place ie xx.x%.Please read the questions and information carefully.1.1 What is the annual net profit (before tax)? (4)1.2 The owner wants to increase the manager’s salary by $12,000 per year.What is the new sales revenue needed to provide this additional salary andmaintain the current level of net profit? Show the equation you used to arrive at thisanswer. (2)(Any added sales revenue will come from increasing seat turnover byimproving/increasing the efficiency of customer service).1.3 Instead of increasing sales revenue by increasing seat turnover and customerservice, the owner decides to increase menu prices by 5%.The owner believes the price increase can be made without losing any customersand without increasing the cost of sales or other variable costs. The original variablecost dollar values and the manager’s salary increase still apply. Hint calculate thenew SR based on the original Sale Revenue.Show the new VC%’s.What will the bar’s net profit (before tax) be? (4)Hospitality Financial Management (HFM)2 © Le Cordon Bleu, Ryde2. The restaurant in the Le Cordon Bleu hotel currently has a cover sale price of $65with a variable unit cost of $21, Fixed costs are $80,000.The owner wants to increase the manager’s salary by $12,000.00 per year.2.1) Calculate the total number of covers to BE and meet the managers salaryincrease. (3)2.2) The owner has also been advised by his supplier, the cost of raw materials isabout to increase by 2.6%.Calculate the number of covers for the increased salary and increased costs.Show the new VCu, CMu in $xx.cc (3)2.3) How many more covers are required to meet the increased Variable Costincrease? (2)3) Using this data, create a table and then use the graphical method of analysis todisplay: Units sold in 1000 increments, Total Sales Revenue, Fixed Costs, Variable Costs, Total Costs