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Requirements 1. Use the contribution margin ratio approach to find a franchise's breakeven sales in dollars. 2. Low believes most locations could generate $55,000 in
Requirements 1. Use the contribution margin ratio approach to find a franchise's breakeven sales in dollars. 2. Low believes most locations could generate $55,000 in monthly sales. Is franchising a good idea for Low if franchisees want a minimum monthly operating income of $12,000? Explain your answer. Owner Shirl Low is considering franchising her Noodles by Low restaurant concept. She believes people will pay $9.00 for a large bowl of noodles. Variable costs are $3.60 per bowl. Low estimates monthly fixed costs for a franchise at $13,500. Read the requirements. Requirement 1. Use the contribution margin ratio approach to find a franchise's breakeven sales in dollars. Begin by showing the formula and then entering the amounts to calculate the breakeven point in sales dollars using the contribution margin approach. (Enter a "0" for any zero balances. Abbreviation used: CM = contribution margin.) + = Required sales in dollars
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