Answered step by step
Verified Expert Solution
Question
1 Approved Answer
2.4 of 4 Janelle Heinke, the owner of Ha'Peppas!, is considering a new oven in which to bake the firm's signature dish, vegetarian pizza.
2.4 of 4 Janelle Heinke, the owner of Ha'Peppas!, is considering a new oven in which to bake the firm's signature dish, vegetarian pizza. Oven type A can handle 20 pizzas an hour. The fixed costs associated with oven A are $20,000 and the variable costs are $2.00 per pizza. Oven B is larger and can handle 40 pizzas an hour. The fixed costs associated with oven B are $30,000 and the variable costs are $1.25 per pizza. The pizzas sell for $14.00 each. a) The break-even point in units for oven type A = 1667 units (round your response to the nearest whole number). The break-even point in units for oven type B = 2353 units (round your response to the nearest whole number). b) If Janelle is expecting that the pizza shop is going to be able to sell 9,000 pizzas, then she should select oven A c) If Janelle is expecting that the pizza shop is going to be able to sell 12,000 pizzas, then she should select oven A d) The volume at which Oven A and Oven B have the same cost (crossover point) and Janelle would be indifferent = 13,333 pizzas (round your response to the nearest whole number).
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started