Question
College Pizza delivers pizzas to the dormitories and apartments near a major state university. The companys annual fixed expenses are $66,000. The sales price of
College Pizza delivers pizzas to the dormitories and apartments near a major state university. The companys annual fixed expenses are $66,000. The sales price of a pizza is $20, and it costs the company $12 to make and deliver each pizza. (In the following requirements, ignore income taxes.)
Required:
-
Using the contribution-margin approach, compute the companys break-even point in units (pizzas).
-
What is the contribution-margin ratio? (Round your answer to 1 decimal place.)
-
Compute the break-even sales revenue. Use the contribution-margin ratio in your calculation.
-
How many pizzas must the company sell to earn a target profit of $72,000? Use the equation method.
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
The Official IRS Tax Guide To Auditing Horse Activities Prepare Your Horse Operation To Withstand An IRS Audit Using The Samw Manual IRS Agents Use
Authors: IRS
1st Edition
092934670X, 978-0929346700
