The manager of Brass Taps is estimating the fixed costs for the upcoming year will be $425,500 and is hoping to have a profit of $135,000.Last year the average check for customers was $14.00.

a) If the variable cost is $695,000 how much in sales would Brass Taps have to do in order to earn the target profit of $135,000.

b) What would be the contribution rate?

c) How much does Brass Taps have to make in order to break even?

You volunteer at a local school's lunch program.Ronnie, the school administrator, knows that you have to take the HTM 2030 course and needs your opinion on whether the school should make their own pizzas as a fundraiser or if they should continue to purchase the pizza from a large national chain.

Unfortunately, Ronnie is very busy, so she does not have time to meet with you, but she has left you a note with the following information and a few critical questions:

There are 200 students in the school.

The school does a pizza fundraiser every week for 28 weeks of the year.

On average each student in the school orders 1.25 pieces of pizza each week.

They currently order from a national chain.Each pizza has 15 large slices and costs $15 per pizza.

The school is located in an economically challenged neighbour hood, as such, she does not believe that they will pay more than $2 for a piece of pizza.

They have received an offer from another organization that supplies the fresh organic wholesome supplies to make the pizza.The pizza crusts have whole wheat crusts, organic vegetables and sauce, and skim milk cheese.Although the school would need to find volunteers to assemble the pizzas, they could use the school kitchen to bake and cook the pizzas.The school would need to spend $190 on cooking utensils and other fixed assets each year.The cost of the pizza crusts, veggies, and cheese is $9 a pizza that can be cut into 10 very large slices (equivalent size to the national chain slices).The waste on the pizza crusts, veggies, and cheese is approximately 10% per pizza.

The school relies on the pizza fundraiser to fund other nutrition programs; therefore they must continue to make at least the same amount of profit.

How many of the organic pizzas would the school have to sell each week before they recovered their costs and made the same amount of money as the current pizza fundraiser?

List at least two other qualitative factors should Ronnie consider when making this decision?

Do you recommend that the school make their own pizzas or continue to purchase them from the national chain? Why or why not?