QUESTION 34 You are considering opening a bagel restaurant aimed primarily at th

Question

QUESTION 34 You are considering opening a bagel restaurant aimed primarily at the breakfast trade. You will sell bagels, coffee, and a pastry in relativel fixed proportions to one another. For each bagel sold, you expect to sell two cups of coffee and one pastry. You will make a profit of So.8 on each bagel, $0.60 on each cup of coffee, and $1.00 on the pastry. Salaries, equipment, and rent cost about $90,000 per year. Calculate the total profit (from bagel, coffee, and pastry) corresponding to each bagel you sell. QUESTION 35 You are considering opening a bagel restaurant aimed primarily at the breakfast trade. You will sell bagels, coffee, and a pastry in relatively fixed proportions to one another. For each bagel sold, you expect to sell two cups of coffee and one pastry. You will make a profit of S0.80 on each bagel, $0.60 on each cup of coffee, and S1.00 on the pastry, Salaries, equipment, and rent cost about $90,000 per year. What is the break-even quantity of bagels?

Explanation / Answer

35)Price of one bagel= 0.80

Price of 2 cups of coffee= 0.6*2= 1.2

Price of one pastry= 1.

Total price= 0.80+1.2+1= 3

At break even, total revenue = total cost

Total revenue= 3x where x is number of bagels.

Total cost= 90000

3x=90000

x= 90000/3= 30000

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