University Pizza delivers pizzas to the dormitories and apartments near a major
ID: 2477833 • Letter: U
Question
University Pizza delivers pizzas to the dormitories and apartments near a major state university. The company’s annual fixed expenses are $67,000. The sales price of a pizza is $16, and it costs the company $8 to make and deliver each pizza. (In the following requirements, ignore income taxes.)
University Pizza delivers pizzas to the dormitories and apartments near a major state university. The company’s annual fixed expenses are $67,000. The sales price of a pizza is $16, and it costs the company $8 to make and deliver each pizza. (In the following requirements, ignore income taxes.)
Explanation / Answer
Particualr Amount in $ Sale Price 16 Variable Cost 8 Contribution (S-V) 8 Contribtion Margin Ratio Contribution (S-V) 8 Sale Price 16 Contribtion Margin Ratio=c/S 0.5 Break even point Particualr Amount in $ Fixed Cost 67000 Contribution per Unit 8 BEP = Fixed Cost / Contribution Per unit 8375 break-even sales revenue. BEP Unit 8375 Sale price 16 Sales Revenue 134000
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