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Use the following information to answer the next 7 questions Betty Crocker is considering starting her own business selling cakes. She is concerned that she
Use the following information to answer the next 7 questions Betty Crocker is considering starting her own business selling cakes. She is concerned that she might not make enough profit to cover all of her costs. She comes to you, her CPA, and provides you with the following information: COSTS TO MAKE A CAKE: Ingredients Costs 6 eggs $1.20 per dozen 2 boxes of cake mix $1.00 per box 1 can of icing $1.30 per can .10 per cake 1/3 cup of oil 1 box $1.00 per box Betty will rent a building for her business and pay $1,000 per month in rent. She figures her utilities will be fixed each month at $200. She is planning on selling her cakes for $25 each. How may cakes does Betty have to sell each month to breakeven in units? Question 22 2.5 pts How may cakes does Betty have to sell each month to breakeven in sales dollars? fuse commas and $ sign) nis its ments D Question 23 2.5 pts How may cakes does Betty have to sell each month in units to earn a net income of $600 per month? we I 2.5 pts Question 24 Assuming that Betty expected her sales to be $2,000, what is her Margin of Safety in Dollars? (use $) Question 25 2.5 pts Assuming Betty expected her sales to be $2.000, what is the Margin of Safety Ratio (use the following format xx%) us ats ments Question 26 25 pts e if Betty were to raise the price of each cake to $27 per cake, have the rent reduced by $200 per month, and hire a person to help her make cakes and pay the helper $6 an hour, it takes 2 hours to make a cake) How many cakes would she have to make to breakeven? 2.5 pts Question 27 If Betty were to raise the price of each cake to $27 per cake, have the rent reduced by $200 per month, and hire a person to help her make cakes and pay the helper $6 an hour, (it takes 2 hours to make a cake): a
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