Holland’s Pizza delivers pizzas to residences and apartments near a major state university. The company's annual fixed costs are $150,000. The sales price averages $25, and it costs the firm $15 to make and deliver each pizza. Required: Determine how many pizzas must Holland sell to break even?B. Determine many pizzas must the company sell to earn a target profit of $25,000?C. If budgeted sales total 20,500 pizzas, determine how much is the company's safety margin in dollars?

Break even point is the point at which company is in no profit no loss situation and contribution is…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Holland’s Pizza delivers pizzas to residences and apartments near a major state university. The company's annual fixed costs are $150,000. The sales price averages $25, and it costs the firm $15 to make and deliver each pizza.

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Determine how many pizzas must Holland sell to break even?
B. Determine many pizzas must the company sell to earn a target profit of $25,000?
C. If budgeted sales total 20,500 pizzas, determine how much is the company's safety margin in dollars?

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