Required:

Prepare an analysis of the possible operating income for Sanjana

	gross margin	number of customers	gross margin	operating cost	marketing and admin	operatingprofit
poor	2	19000
fair	4.4	19000
good	5.4	19000
poor	2	24000
fair	4.4	24000
good	5.4	24000
poor	2	34000
fair	4.4	34000
good	5.4	34000

Sanjanas Sweet Shoppe operates on the boardwalk of a New England coastal town. The store only opens for the summer season and the business is heavily dependent on the weather and the economy in addition to new competition. Sanjana Sweet, the owner, prepares a budget each year after reading long-term weather forecasts and estimates of summer tourism. The budget is a first step in planning whether she will need any loans and whether she needs to consider adjustments to store staffing. Based on expertise and experience, she develops the following:

Scenario	Gross Margin per Customer (Price - Cost of Goods)	Number of Customers
Good	$5.4	34,000
Fair	4.4	24,000
Poor	2.0	19,000

Sanjana assumes, for simplicity, that the gross margin and the estimated number of customers are independent. Thus, she has nine possible scenarios. In addition to the cost of the products sold, Sanjana estimates staffing costs to be $29,000 plus $2 for every customer in excess of 24,000. The marketing and administrative costs are estimated to be $10,700 plus 3 percent of the gross margin.

Required:

Prepare an analysis of the possible operating income for Sanjana