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swer saved arked out of 00 Flag question Shelly is starting a small business- she will be making specialty pizzas and delivering them to nearby
swer saved arked out of 00 Flag question Shelly is starting a small business- she will be making specialty pizzas and delivering them to nearby customers. Because she will be able to work from home, Shelly is hoping her business costs are not overwhelming as she starts things up. She expects to produce 350 pizzas in her first three months of business. She plans to obtain an average sale price of $13.50 per pizza (includes tip). On average, a pizza will require $4.40 worth of ingredients (utilities costs included). Shelly has calculated delivery service will add costs of $3.85 per pizza. Shelly expects to make and deliver 420 pizzas in her second quarter, 480 pizzas in her third quarter, and 530 pizzas in her fourth quarter. Her friend, Garrett, is going to be working overseas for the next year and has offered Shelly a chance to rent his electric vehicle (EV) for twelve months. Shelly has asked the bank about borrowing the $5,000 for renting the car and she has been offered a 5.75% interest rate. With the EV, Jackie's delivery cost per pizza would drop to $0.95 per pizza She wants advice from you on if she should rent the EV for her first year of business. She also wants you to analyze how her business is trending (specifically the annual volume and profits she can expect in year 2 compared to year 1).
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