1. Determine the break even point for each of the proposed lines. Explain why the break even point is a better indicator than sales.Show your calculations.
2. After making some enquiries you find out that the Pinot Grigios requires 1000 litres of water per 200 bottles. The Riesling requires 1000 litres per 250 bottles. All water used is sourced from a dam on the property and does not create any additional costs. Nearby Vineyards have recently begun marketing their wines as environmentally friendly. Will this information impact your advice as to which line should be implemented?

Calypso Wines has two potential new product lines available. The CEO only wants to implement one of the product lines as she believes the business does not have the capacity to implement multiple new lines. The available data for each of the lines is as follows: $3,360 Pinot Grigios Cost of growing grapes (includes organic pesticides) Labour Electricity costs per bottle Packaging and transportation to buyer Sale price per bottle 1 hour per bottle at $24 $7 $15 per bottle $60 $4,760 Riesling Cost of growing grapes (includes organic pesticides) Labour Electricity costs per bottle Packaging and transportation to buyer Sale price per bottle 1.5 hour per bottle at $24 $7 $15 per bottle $75