Last year, the company sold 50,000 units and had the below sales and cost figures....
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Last year, the company sold 50,000 units and had the below sales and cost figures. Adding Food - Total sales in the number of units would increase 25% (if added) - The average sales price per unit would increase from the current $3.00 to $5.00 (if added) - The variable cost per unit would increase to $2.50 per unit to account for the added cost (if added) - There would be an increase in fixed costs of $25,000 for advertising (if added) Adding Drive Up Window - This alternative is exclusive of Adding Food Option - Total sales in the number of units would go up 130% from last year. - The construction of the drive up window would increase fixed costs by $130,000 - which represents 1 construction & installation costs. - Drive Up Window would allow an increase in average sales to $3.20 a cup of coffee and variable cost per unit would remain the same at $0.90 per unit. 1.) Compute the break-even point in units under the 3 situations
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