Equation: EBDAT= Revenues- Variable Costs- Cash fixed costs NOTE: Each small cup of yogurt is sold for $3 and the cost of producing the frozen yogurt is $1.50 per cup. Admin. expenses, including Jen and Larry's salaries along with 2 other accountants were estimated to be $180,000 in 2013. Marketing expenses, advertising were projected to be $200,000 in 2013. Interest expenses were estimated at 15,000. The average tax rate is expected to be 25% of taxable income. Q: Jen and Larry believe that under the worst case scenario. yogurt revenues would be at the 2012 level of $600,000 even after plans and expenditures were put into place to increase revenues in 2013. What would happen to the Venture's EBDAT?
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