Answered step by step
Verified Expert Solution
Question
1 Approved Answer
please help me solve these problem with explanation. thank you! a. Fridge No More reports average revenue per order of $33.00 and average costs per
please help me solve these problem with explanation. thank you! a. Fridge No More reports average revenue per order of $33.00 and average costs per order of cost of goods of $22.20, write-offs of $2.10, payment processing fees of $1.20, packaging costs of $2.10, delivery costs of $5.70, and warehouse costs of $3.00. Given this information, what is the average contribution margin per unit? b. Based on your calculation in part a, do you think this business is sustainable? Explain. c. Assume Fridge No More continues to maintain an average revenue per order of $33.00 but figures out a way to reduce variable costs per order to $31. Also assume Fridge No More has $250,000 in annual fixed costs, including sales and marketing costs, administrative costs, and other overhead costs. How many deliveries do they have to do each year to breakeven? How many deliveries per day do they need to do to breakeven? How much in revenue do they need to do each year to breakeven
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started