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The Yummy Delights Factory plans to open a new retail store in Denver, Colorado. The store will sell specialty cupcakes for $3 per cupcake (each

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The Yummy Delights Factory plans to open a new retail store in Denver, Colorado. The store will sell specialty cupcakes for $3 per cupcake (each cupcake has a variable cost of $1.) The company is negotiating its lease for the new store. The landlord has offered two leasing options: 1) a lease of $4,000 per month; or 2) a monthly lease cost of $2,500 plus 10% of the company's monthly sales revenue. Requirements 1. If the Yummy Delights Factory plans to sell 4,400 cupcakes a month, which lease option would cost less each month? Why? 2. If the company plans to sell 6,500 cupcakes a month, which lease option would be more attractive? Why? Requirement 1. If the Yummy Delights Factory plans to sell 4,400 cupcakes a month, which lease option would cost less each month? Why? Begin by calculating the indifference point. Select the equation to determine the indifference point. (Abbreviations used: FC = Fixed costs, VCU = Variable costs per unit)

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