) Randy's Pizza delivers pizzas to dormitories and apartmentsnear a major state university. The company's annual fixed costs are$48,000. The sales price averages $9, and it costs the firm $3 tomake and deliver each pizza.
Required:
A. How many pizzas must Randy's sell to break even?
B. How many pizzas must the company sell to earn a target profitof $54,000?
C. If budgeted sales total 9,900 pizzas, how much is thecompany's safety margin in dollars?
D. Tony's assistant manager, an accounting major, has suggestedthat the firm should try to increase the contribution margin perpizza. Explain the meaning of "contribution margin" in layman'sterms.
