El Charro Food Truck is a Mexican Food Truck that specialives in Mexican Street Food. The owner is considering introducing a poplar Mexican street food item, Elotes. Elotes is Spicy Grilled Mexican Strect Corn and they are considering it because a lot of people have been asking foe it. They decided to sell a family sipe Plotes bow. Before they introduce their Elotes, they want to run some sumbers to make sure it will be a good financial decision. As sueh, they asked you to help thern with their numbers. Here are numbers they noed help with. Owner's Salary: $5,000 Com on the Cobis? Utilities: 51000 Cilantro: $0.40 Food Truck Rental: 58,000 Eqaiproent: $6,000 Mayonnaise: $1.60 soctet ingredient, 53,00 wages paid per Elotes: $3.00 E1 Charros has decided to use Coanecticut as a test market and the average price of a large gourmet Elotes in Connecticut is $25, There are also 1 million Elotes sold in Connectacut. The ecmpany plans to use penctration pricing and as such decides to selt their Elotes for 80% of the average price of chocolate sold in Conaceticut. They also project that they will be able to sell the equivalent of 1% of the Elotes sold in Conecticut. Use the numbers provided above to answer quevions below. Make sure that you show all formulas and also show all your ealeulations since there will be points awarded for the formula and calculations. Formulas are attached to the back of this test. 1. The company wants you to calculate (20 points). a. How many Hotes boxes they need to sell to brcak even. b. The value (in dollirs) of the number of Elotes boxes they aced to sell to break even. c. What proportion of market shaft will thcy be capturing if all they do is sell enough Elotes to break cven? in Conocticut. The company plans to aise penetration perieing and as sach decides to sell their Elotes for Bosk of the average price of chocolate wold in Connecticut They alse project that they wil be able to sell the equivalent of 1% of the Elotes sold in Connecticut. Use the numbers provided above to answer questions below. Make sure that you show all formulas and also show all your calculations since there will be points awarded for the formula and caleulations. Formulas are attached to the back of this test. 1. The company wants you to calculate (20 points) a. How magy Flotes boses they seed to sell to break even. b. The value (in dollarn) of the number of Eloets boxes they necd to sell to break even. c. What proportion of magket shate will they be capteries if all they do is sell coough Elotes to break even? 2. The compary needs to knew bow much profit they will make. Using their projections of what they think they cas sell, calculate their profits using the profit oquation ( 20 points) 2. Create a Proforma Income Statement using the information provided in the pages above. The Cost of Goods Sold in this secnano is equal to the Toeal Vanable Coat. Focus on the quantities sold that are as sociated with the Profit equation calculation in question 2 . Nol the break even quantities. (20 points) \$15 dollars and Walmart will weli the Elotes in their tores for $20. If Wolmart agres to El Charros's terms (20 points) a. What will ti Carros's trade margin be? b. What will El Charrot'r trade margin % be? c. What will Walmart's trade margin be? d What will Walmart's tonde marein % bo? 5. ElCharros decibsd that they wamed to change sheit nargin percent to 45%. Iow much should they sell their Elotes to Walman? (10 points)
