The oner of Long Island Restarant is disappointed because the restaurant has been araging 7,500 pzza salas per month, but the restaurant and wait staff can make and serve 10,000 pzzas par month. The variable cost (for example, ingredients) of sach pzza is $1.55. Monthly fixed costs (ior example, depreciation, property tanes, business license, and managers salary) are 512,000 per month. The owner wants coet information about difterent volumes so that some operating decisions can be made. Read the ACITAMAnts Monthly pzza volume 6,000 7,500 10,000 Total fored costs Total vanable costs Total costs Fbied cost per plzza. Variable cost per pizza Averags cost par pizza Seling price per pizza 625 $ 625 S 6 25 Requirement 2. From a cost standpoint, why do companies such as Long Island Restaurant want to operate near or at fulil capadity? Companies want to run at full capacity to better utilze the resources they spend on 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 cautting the seling price per pizza from $6 25 a pizza to $5 75 How much extra prot (abave the current level) would be generated if the selling price costs. The more units they produce, the T the cost per unit. were 10 be decreased? Hm: Fnd the restaurants current monthly prom 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 cument and the new volume. Monthly profi 7,500 pz289 10,000 pizzas Sinceho restaurant wil generate ofsthownar should the sales pricest the sales price to