Snowies Shaved Ice Business Case Required: Please fill in the highlighted cells using numbers from the case and formulas when appropriate. Name: Part 1 Data Amount Selling price per large Snowie $ 4.00 Ice per Snowie Spoon straw (need one per Snowie) Styrofoam cup (need one per Snowie) Napkin (need two per Snowie) Servings per gallon of syrup Cost per gallon of syrup (includes concentrate, preservative, and sugar) Hourly rate for workers Event registration fee per day Electricity, insurance, maintenance, and permit costs per month Kiosk rental cost per month (12-month lease) Purchase cost of two ice shavers (5-year life) Purchase cost of a flavor station (5-year life) Requirements 1. Assumptions (to be filled in): a. Number of days you anticipate opening the kiosk per month 20 b. Number of hours you will work (no wages required) per day 6 c. Number of hours you will pay an employee to work in the kiosk per day 8 2. Cost of syrup per Snowie: Syrup cost per Snowie (Cost per gallon / Servings per gallon of syrup) 3. Cost of worker wages per day and month: a. Cost per day (Hourly rate for workers x Number of hours you will pay an employee) b. Cost per month (Cost per day above x Number of days kiosk is open per month) 4. Total variable cost per Snowie Cost of syrup per Snowie (from Question 2) Ice per Snowie Spoon straw (need one per Snowie) Styrofoam cup (need one per Snowie) Napkin (need two per Snowie) Total variable cost per Snowie 5. Total fixed cost per month Wages for workers for month Event registration fee per day x number of days kiosk open Kiosk rental cost per month Straight-line depreciation - ice shavers ($3,180 / 5 years / 12 months) Straight-line depreciation - flavor station ($1,080 / 5 years / 12 months) Total fixed cost per month 6. Break even volume per month Total fixed costs Unit contribution margin (Selling price - Variable cost per Snowie) Number of Snowies to be sold per month to break even 7. Number of Snowies to be sold to earn target profit of $2,000 per month Total fixed costs plus target profit Unit contribution margin (Selling price - Variable cost per Snowie) Number of Snowies to be sold per month to earn target profit

Part 2 Data (all from Part 1 except for new selling price and cup cost) Selling price per large Snowie $ 3.00 Ice per Snowie Spoon straw (need one per Snowie) Styrofoam cup (need one per Snowie) Napkin (need two per Snowie) Syrup cost per Snowie (from Part 1, Question 2) Total variable cost per Snowie $ - Sales revenue from Octoberfest (200 Snowies sold) Variable costs for Octoberfest Total contribution margin - Octoberfest Should Snowie accept the special price offer? (Yes or No to the next cell)

Part 3 Data (all from Part 1 except for new selling price and syrup cost) Selling price per large Snowie $ 5.00 Ice per Snowie Spoon straw (need one per Snowie) Styrofoam cup (need one per Snowie) Napkin (need two per Snowie) Servings per gallon of syrup Cost per gallon of syrup (includes concentrate, preservative, and sugar) Hourly rate for workers Event registration fee per day Electricity, insurance, maintenance, and permit costs per month Kiosk rental cost per month Purchase cost of two ice shavers (5-year life) Purchase cost of a flavor station (5-year life) Requirements 1. Assumptions a. Number of days you anticipate opening the kiosk per month 20 b. Number of hours you will work (no wages required) per day 6 c. Number of hours you will pay an employee to work in the kiosk per day 8 d. Number of Snowies you estimate you will sell on an average day 69 Cost of syrup per Snowie (based on the new cost per gallon): Syrup cost per Snowie (Cost per gallon / Servings per gallon of syrup) 2. Budgeted contribution margin income statement for one month. Business Name Budgeted Contribution Margin Income Statement For Month Ended July 31 Sales revenue $ 6,900.00 Less variable expenses: Ice expense Spoon straws Styrofoam cups Napkins Syrup Total variable expenses $ - Total contribution margin $ 6,900.00 Less fixed expenses: Wages for workers Event registration fees Kiosk rental cost Depreciation - ice shavers Depreciation - flavor station Total fixed expenses $ -