Question
You start a lemonade stand. You estimate that you will make and sell 2,000 glasses of lemonade during the upcoming summer. You sell the lemonades
You start a lemonade stand. You estimate that you will make and sell 2,000 glasses of lemonade during the upcoming summer. You sell the lemonades for $2.50 each. You have determined that you have the following costs associated with each glass of lemonade made and sold( aka "unit cost" aka "cost per unit):
Lemons, cups and sugar $1.00
Labor(making lemonades) .30
Sales commission .20
Also, you have determined the following totals for the entire season:
Depreciation on blender $300.00
Blender Maintenance $700.00
Rent on a lemonade stand $1,000
Advertising $500.00
Accountant and other $500.00
a) how much "contribution margin" do you make each glass?
b) How many cups must you sell to "break even"?
c) What is your expected total sales revenue for the period? How did you get this?
d) How much does it cost you to make a glass of lemonade? Please explain your answer.
e) Are we expecting to make money during the upcoming season? In other words, what's the "budget profit"?
Pls help from letter a through e! Will give like!
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