Cost Behavior
Assume a local pizzeria reported the following results for June and July
	April	May
Unit Sales	2,000	3,000
Cost of Food Sold	$ 8,000	$ 12,000
Wages and Salaries	3,700	4,000
Rent	2,000	2,000
Depreciation	500	500
Utilities	1,400	1,500
Supplies	200	300
Total	$ 15,800	$ 20,300
a. Identify each cost as being fixed, variable or mixed.
b. Determine the equation for total operating costs (Fixed + Unit Variable Cost * # of sandwiches)
c. Predict the total operating costs for			4000	pizzas
d. Determine the average costs for			4000	pizzas
Concept question: Why are fixed costs generally not relevant for decision-making?
Would average costs be useful for decision-making and why or why not?