Owner Shan Lo is considering franchising her Noodles restaurant concept. She believes people will pay \($8\) for a large bowl of noodles. Variable costs are \($1.60\) per bowl. Lo estimates monthly fixed costs for a franchise at $8,600.

Requirements 

1. Use the contribution margin ratio approach to find a franchise’s breakeven sales in dollars.

2 Lo believes most locations could generate \($22,313\) in monthly sales. Is franchising a good idea for Lo if franchisees want a minimum monthly operating income of $8,850?