Requirement 2. Assuming that the price cut and advertising campaign are successful at increasing volume to the projected level, will the franchisees still earn target profit of $7,150 per month? Show your calculations.

Before franchising her Happy Noodles restaurant concept, owner Fay Woo had made the following assumptions (Click the icon to view the assumptions.) i (Click the icon to view more information.) Read the requirements. Requirement 1. What was the average restaurant's operating income before these changes? Identify the formula labels and compute the operating income before the changes. Break even point 35,750 13,475 22,275 7,800 14,475 x Variable expenses Contribution margin Less: Fixed expenses Operating income More Info Woo believed people would pay $7.00 for a large bowl of noodles. Variable costs would be $2.45 a bowl creating a contribution margin of $4.55 per bowl. Fay Woo estimated monthly fixed costs for franchisees at $7,800. Franchisees wanted a minimum monthly operating income of $7,150