A club is interested in determining the dollar sales at break even point. Sales can be broken down into four

categories as follows.

Item Demand forecast

Annual

Variable cost per

unit ($)

Selling price per

unit ($)

Beer 30,000 drinks 0.75 1.5

Meals 10,000 5 10

Desserts 10,000 1 2.5

Sandwiches 20,000 3.25 6.25

Fixed costs (rent, utilities etc) are $ 1800 per month plus $2000 per month for entertainment.

a) Determine break even point in dollars per month

b) Determine the expected number of items to be sold each day for breaking even. Assume the club is open

30 days in a month.