City Pizza is adding salads and pasta dishes their available menu items. They estimate that they will sell 1 order of pasta for every 12 pizzas and 2 salads for every pasta, resulting in a sales mix of 12:1:2. City Pizza has a total of $56, 700 in monthly fixed costs and provide the following data on selling price and variable cost per unit for the menu. The current operations have the capacity to produce 8000 units per month. Complete the tables below. Calculate the product breakeven units and dollars. Post a reply to this thread answering the following questions. If the store operates at 80% of capacity each month, what is the potential profit? Explain how they might alter their sales mix to reduce the break even number and increase the profits. Would you suggest an alteration to the sales mix, fixed costs or variable costs?

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Factors Pizza Pasta Salad Solling price per unit $25.33 $9.99 $5.50 Variable cost per unit $10.97 $3.50 $2.97 Contribution margin per unit Contribution margin ratio 45% 75% 63% Sales Mix Ratio Weighted Average Contribution Margin Per Product WACM Dollars WACM Break-Even Product Break-Even Point Units Factors Pizza Pasta Salad Solling price per unit $25.33 $9.99 $5.50 Variable cost per unit $10.97 $3.50 $2.97 Contribution margin per unit Contribution margin ratio 45% 75% 63% Sales Mix Ratio Weighted Average Contribution Margin Per Product WACM Dollars WACM Break-Even Product Break-Even Point Units

Answer rating: 100% (QA)

Solution Particulars Pizza Pasta Salad Total Selling Price per Unit 2533 999 550 Variable C... View the full answer