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please help ASAP Sharon is a creative, artistic person. A few years ago, she had enough of spending $5 for birthday cards. She could do
please help ASAP
Sharon is a creative, artistic person. A few years ago, she had enough of spending $5 for birthday cards. She could do it herself-and she did! She created beautiful, fun cards for many occasions, and sent them to all of her friends and family. In the process, she got a lot of feedback from the recipients suggesting she could sell them. Hmm. Now there's an idea. Sharon doesn't want to charge as much as the big greeting card companies, and yet she wants to make a little profit on these cards in order to make it worth her time. She is contemplating a selling price of $2.70 and estimates the cost of paper and other miscellaneous items to be about $0.80 per card. Her fixed costs are quite small, since she runs the small business out of her home. She estimates her fuxed costs at just $646 per year. Before actually promoting this business, she wants to feel confident that she will make money. Naturally, she turns to her CVP skills to help answer the following questions. (a) How many cards does Sharon need to sell to break even? Number of cards to break even units Windsor's is the new favorite pizza, pasta, and sub place in town! Everyone raves about the generous portions and the delicious flavors of this restaurant's classic, go-to eats. After one year of operations, the manager, Laticia, wants to evaluate what has gone well and what could go better. She notes that while pizza represents the company's biggest sales volume item, it isn't necessarily the most profitable item. Alternatively, pasta, while not the biggest seller, does generate a very high contribution margin. Laticia is struggling with how to balance these two seemingly opposite products in terms of their profitability, while recognizing that subs are also becoming popular among the usual crowd. Here are the current contribution margins for each of the three products. Laticia knows that for every two sub sandwiches sold, Windsor's sells three orders of pasta and five pizzas. She also knows that if she wants to keep her management position, and possibly even get another raise. she's going to have to help Windsor's manage its growing costs. The operating costs, outside of the food costs, came to $4,345 last month. She has overheard the owner grumbling that this month and going forward, those costs are expected to increase. (a) Determine the break-even point in units for each of the three products Step by Step Solution
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