Lois is planning to make fancy, multi-tiered wedding cakes for the next wedding season. To make the cakes, she must invest $2900 in some special baking tools. To promote her business, she also needs to spend $6265 to advertise in the newspaper. She estimates that supplies and materials for each cake will cost $690. She is planning to set the price for each cake at $925. (a) Compute the contribution margin. (b) Compute the contribution rate. (c) Compute the break-even point in units. (d) Compute the break-even point in sales dollars. (a) The contribution margin per unit is $ (b) The contribution rate is (c) The break-even point is (Type a whole number.) %. (Round to two decimal places as needed.) cakes. (Round up to the nearest unit.)

Lois is planning to make fancy, multi-tiered wedding cakes for the next wedding season. To make the cakes, she must invest $2900 in some special baking tools. To promote her business, she also needs to spend $6265 to advertise in the newspaper. She estimates that supplies and materials for each cake will cost $690. She is planning to set the price for each cake at $925. (a) Compute the contribution margin. (b) Compute the contribution rate. (c) Compute the break-even point in units. (d) Compute the break-even point in sales dollars. (a) The contribution margin per unit is $ (b) The contribution rate is (c) The break-even point is (Type a whole number.) %. (Round to two decimal places as needed.) cakes. (Round up to the nearest unit.)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Teresa's taco truck currently sells 2,500 tacos per day, for $6 each. Teresa estimates that, for each $1 she Increases the price of a taco, she will sell 300 less tacos per day (fewer people will want to buy if the price Increases). 1. How much money does Teresa currently make (total) per day? 2. How much revenue would she make If she Increased the price of a taco to $7 and she sold 300 fewer tacos? 3. Find a function that glves the quantity sold in terms of the price. (Hint, find two points and then find the linear equation between them.) 4. Find a function that models Teresa's revenue per day in terms of the price of a taco. (Hint: Revenue=quantity times price.) 5. Find the taco price and total revenue that maximizes revenue per day from taco sales. Round your answer(s) to the nearest cent.
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Sparkle This! is an online jewelrystore. The owner, Joe Diamond, maintains a 48% target margin at all times. They are considering adding ruby heart pendants to their product line for Valentine's Day. The cost from their supplier is $33. Joe estimates they can sell 54 pendants for Valentine's Day at the price based on their usual target margin. What would be the Total Contribution Margin for the pendants at the Price and Volume that Joe has estimated on Valentine's Day?
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2) Your firm (a shampoo maker) has decided to enter a new industry: Doughnuts. Bubbles Doughnuts will compete with Dunkin Donuts and Krispy Kreme. You will try to exploit your current customer base, women who like to pamper themselves and secretly eat a lot of doughnuts. There will be 25 locations. The combined land and construction cost for all 25 sites will be $20million. Construction will be completed in one year. The land is approximately one quarter of the cost and cannot be depreciated. The remaining fixed costs will be depreciated 20 year, straight line. After twenty years of operation, you will exit the business. You anticipate the doughnut shops to have no salvage value but the land can be sold for $7m (net, so after all relevant taxes have been paid). When you open for business after construction is complete, each shop is expected to average sales of $2m/yr. and have operating costs of $1.8m/yr. over its twenty-year life (both of these are end of year figures). The entire…
A nonprofit decides to provide free food for the homeless in Thanksgiving holidays. The manager wants to write a proposal to raise money from their donors. Assume that the project requires a fixed cost of $5,000 for staff and equipment. The variable cost such as utensils and food is $5 per person served. Based on the manager's experience, the manager estimates there will be 200 homeless people to serve. What is the price per person that the manager should put into his/her proposal? a.$5 b.$30 c.$25 d.$5,000
Don is using the floor plans for his new home to help him purchas base molding for the place where the walls meet the floor. The plans are drawn using a scale in which 1/3 inch represents 1 foot. He measures the walls on the floor plan with a ruler and finds they total 24 inches. If the molding costs $3.12 per foot, how much will Don spend on molding?
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The twig stands are more popular, so Bobby sells four twig stands for every one oak stand. Katie charges her husband $400 to share her booth at the craft shows (after all, she has paid the entrance fees). How many of each plant stand does Bobby need to sell to breakeven? Will this affect the number of scarves Katie needs to sell to breakeven? Explain. Bobby Arthur admired his wife's success at selling scarves at local crafts shows, so he decided to make two types of plant stands to sell at the shows. Bobby makes twig stands out of downed wood from his backyard and the yards of his neighbors, so his variable cost is minimal (wood screws, glue, and so forth). However, Bobby has to purchase wood to make his oak plant stands. His unit prices and costs are as follows: E(Click the icon to view the data.) Determine how many of each plant stand Bobby needs to sell to breakeven. Begin by computing the weighted-average contribution margin per unit. First identify the formula labels, then…
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