Question Help The owner of Queens Restaurant is disappointed because the restaurant has been averaging 8,000 pizza sales per month, but the restaurant and wait staff can make and serve 10,000 pizzas per month. The variable cost (for example, ingredients) of each pizza is $1.45. Monthly fixed costs (for example, depreciation, property taxes, business license, and manager's salary) are $10,000 per month. The owner wants cost information about different volumes so that some operating decisions can be made. E: (Click the icon to view the chart for Requirement 1. ) Read the requirements. 6.25 $ 6.25 Selling price per pizza. Average profit per pizza 6.25 $ 3.55 2.80 3.80 Requirement 2. From a cost standpoint, why do companies such as Queens Restaurant want to operate near or at full capacity? Companies want to run at full capacity to better utilize the resources they spend on fixed costs. The more units they produce, the higher the average fixed cost per unit. Requirement 3. The owner has been considering ways to increase the sales volume. The owner thinks that 10,000 pizzas could be sold per month by cutting the selling price per pizza from $6.25 to $5.75. How much extra profit (above the current level) would be generated if the selling price were to be decreased? (Hint: Find the restaurant's current monthly profit and compare it to the restaurant's projected monthly profit at the new sales price and volume.) Identify the profit formula and compute the monthly profit at the current and the new volume. Total revenues Total costs Monthly profit 8,000 pizzas 10,000 pizzas of the owner should the sales price to Since the restaurant will generate the volume. ? Choose from any list or enter any number in the input fields and then continue to the next question. . N 22