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Owner Sue Lo is considering franchising her Global Wok restaurant concept. She believes people will pay $7.00 for a large bowl of noodles. Variable costs
Owner Sue Lo is considering franchising her Global Wok restaurant concept. She believes people will pay $7.00 for a large bowl of noodles. Variable costs are $2.45 a bowl. Lo estimates monthly fixed costs for franchisees at $7,800. Read the requirements. Requirement 1. Find a franchisee's breakeven sales in dollars. Begin by identifying the formula to compute the sales in units at various levels of operating income using the contribution margin approach. + Breakeven sales in dollars - X Requirements 1. Find a franchisee's breakeven sales in dollars. 2. Is franchising a good idea for Lo if franchisees want a minimum monthly operating income of $7,150 and Lo believes that most locations could generate $25,000 in monthly sales
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