stuck on requirement 3. what would the progit formula anf monthly profit be at the current and new volume?
wrc-Um WUUN Sau Question Help The owner of Marshall Restaurant is disappointed because the restaurant has been averaging 7,500 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 $1.55. Monthly fixed costs (for example, depreciation, property taxes, business license, and manager's salary) are $12,000 per month. The owner wants cost information about different volumes so that some operating decisions can be made. Read the requirements Requirement 1. Use the chart below to provide the owner with the cost information. Then use the completed chart to help you answer the remaining questions. (Enter total variable costs to the nearest dollar. Enter costs per pizza, price per pizza, and profit per pizza to the nearest cent) Monthly pizza volume 6,000 7,500 10,000 Total fixed costs Total variable costs 12,000 $ 9,300 21,300 $ 12,000 $ 11,625 12,000 15,500 $ Total costs 23,625 $ 27,500 $ Fixed cost per pizza Variable cost per pizza Average cost per pizza 2.00 $ 1.55 3.55 $ 1.60 $ 1. 55 3.15 S 1 1.20 .55 $ 2.75 Selling price per pizza Average profit per pizza 6.25 $ 2.70 S 6.25 $ 3.10 $ 6.25 3.50 Enter any number in the edit fields and then click Check Answer. parts 2 remaining Clear All Final Check P2-46A (book/static) Question Help The owner of Marshall Restaurant is disappointed because the restaurant has been averaging 7,500 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 $1.55. Monthly fixed costs (for example, depreciation, property taxes, business license, and manager's salary) are $12,000 per month. The owner wants cost information about different volumes so that some operating decisions can be made. Read the requirements 1.55 1.55 1.55 Variable cost per pizza 3.55 $ Average cost per pizza 3.15 2.75 $ $ Selling price per pizza Average profit per pizza 6.25 $ 2.70 $ 6.25 $ 3.10 $ 6.25 3.50 Requirement 2. From a cost standpoint, why do companies such as Marshall Restaurant want to operate near or at full capacity? costs. The more units they produce, the lower the Companies want to run at full capacity to better utilize the resources they spend on fixed 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 a pizza 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 7,500 pizzas Enter any number in the edit fields and then click Check Answer 2 remaining parts Clear All Final Check
