Suppose that you and your friends decide to have a bake sale to earn money for a

Question

Suppose that you and your friends decide to have a bake sale to earn money for a charity. You decide to purchase a table and a sign to advertise your booth for $50. To operate, you need to have cookies, plates, and napkins. According to your calculations, the cost of each cookie sale is about $.75 (includes the cost of the plate and napkin that it is served). So, you set the price of each cookie at $1.25.

(a)What are your revenues, total expenses and profit if you sell 200 cookies?

(b)What are your revenues, expenses and profit if you sell 200 cookies at $1.75 each?

(c)How many cookies do you need to sell at $1.25 to make $100 in profits? (Determine the answer by entering different numbers of cookies sold in the appropriate cell until you get the desired result).

(d)How many cookies do you need to sell at $1.25 to break even? Enter a formula to calculate the break even point.

Explanation / Answer

(a)What are your revenues, total expenses and profit if you sell 200 cookies? total revenue = 1.25*200 = 250$ total expenses = .75 * 200 + 50 = 200$ profit = 250 - 200 = 50$ (b)What are your revenues, expenses and profit if you sell 200 cookies at $1.75 each? total revenue = 1.75* 200 = 350$ total expenses = .75 * 200 + 50= 200$ profit = 350 - 200 = 150$ (c)How many cookies do you need to sell at $1.25 to make $100 in profits? (Determine the answer by entering different numbers of cookies sold in the appropriate cell until you get the desired result). let the no be x then x*1.25 - x*0.75 -50 = 100 => x = 300 300 cookies need to be sold (d)How many cookies do you need to sell at $1.25 to break even? Enter a formula to calculate the break even point. break even is no profit => 50 + 0.75x = 1.25x =>x = 100 100 cookies need to sell

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