d. $75,000 21. Betty Crocker is considering starting her own business selling cakes. She is concerned that she might not make enough profit to cover all of her costs. She comes to you, her CPA, and provides you with the following information: COSTS TO MAKE A CAKE: Ingredients Costs 6 eggs $1.20 per dozen 2 boxes of cake mix $1.00 per box 1 can of icing $1.30 per can 1/3 cup of oil .10 per cake 1 box $1.00 per box Betty will rent a building for her business and pay $1,000 per month in rent. She figures her utilities will be fixed each month at $200. She is planning on selling her cakes for $25 each. REQUIRED: a. How many cakes does Betty have to sell each month to: Breakeven in units Breakeven in Sales Dollars c Earn a net profit of $600 per month in units d. Assuming that Betty expected her sales to be $2,000, what is her Margin of Safety in Dollars? D. of Betty were to raise the price of each cake to 527 per cake, have the rent reduced by $200 per month, and hire a person to help her make cakes and pay the helper 56 an hour, (it takes 2 hours to make a cake): a How many cakes would she have to make to breakeven? b How many cakes would she have to make to earn a net profit of $1,000 per month? Breakeven in units Breakeven in Sales Dollars Earn a net profit of $600 per month in units d. Assuming that Betty expected her sales to be $2,000, what is her Margin of Safety in Dollars? b. If Betty were to raise the price of each cake to $27 per cake, have the rent reduced by $200 per month, and hire a person to help her make cakes and pay the helper $6 an hour, it takes 2 hours to make a cake): a. How many cakes would she have to make to breakeven? b. How many cakes would she have to make to earn a net profit of $1,000 per month