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SUPPOSED THE COFEE BEAN HAS A NEW SHOP IN CAMBRIDGE VILAGE SHOPPING CENTER THAT SELLS...

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Accounting

SUPPOSED THE COFEE BEAN HAS A NEW SHOP IN CAMBRIDGE VILAGE SHOPPING CENTER THAT SELLS HIGH END TEAS AND COFFEES, FUTHER, SUPPOSE IT HAS ADDED SMOOTHIE DRINKS TO ITS PRODUCT LINE. BELOW ARE THE ASSUMED SALES AND COST DATA FOR THE COMPANY .
Coffee Teas Smoothie
Sales price per (120z) serving $1.35 $1.25 $1.95
Varuable cost per serving 0.600.450.75
Fixed cost per month $8,000
a. Calculate cofee bean's operating levarage ratio
b. If sales inv=crease by 20%, by how much will before -tax profit to be expected to change
c.If sales decrease by 20%, by how much will before-tax profit be expected to change ?

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