Worldly Creation Company plans to open a new retail store in Hallowell$,$ Maine. The store will sell specialty candles for an average of $ $20$ each. The average variable costs per candle are as$$ follows:

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Wax $ $5$

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Other additives $ $2$

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Base $ $1$

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Part $1$

The company is negotiating its lease for the new location. The landlord has offered two leasing$$ options:

Option$$ A$)$ a lease of $ $2$ comma $400$ per$$ month; or

Option$$ B$)$ a monthly lease cost of $ $900$ plus $15\%$ of the$$ company's monthly sales revenue.

The company expects to sell approximately $450$ candles per month.

Read the requirementsLOADING....

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Part $1$

Requirement $1.$ Which lease option is more attractive for the company under its current sales$$ expectations? Calculate the total lease cost under Option A and Option B$.$

Begin by identifying the formula to calculate the total costs.

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Total lease costsWorldly Creation Company plans to open a new retail store in Hallowell, Maine. The store will sell specialty candles for an average of $$20$

each. The average variable costs per candle are as follows:

$,$ Wax $$5$

$,$ Other additives $$2$

$,$ Base $$1$

The company is negotiating its lease for the new location. The landlord has offered two leasing options:

Option A$)$ a lease of $$2,400$ per month; or

Option B$)$ a monthly lease cost of $$900$ plus $15\%$ of the company's monthly sales revenue.

The company expects to sell approximately $450$ candles per month.

Read the requirements.

Requirement $1.$ Which lease option is more attractive for the company under its current sales expectations? Calculate the total lease cost under Option A and Option B$.$

Begin by identifying the formula to calculate the total costs.