A museum plans to open a gift shop where it will sell t-shirts with the museum logo. To finance the opening of the shop, the museum: takes out a $20,000 loan with a 5.0% annual interest rate and secures a $20,000 donation that will help support the operation of the museum during the first year. The museum immediately uses the entire proceeds of the loan to purchase furniture and equipment, which have a useful life of 5 years and no salvage value. The t-shirts each cost $5 to make, and the museum plans to charge $20 for each shirt. The shop will be open five days per week for 50 weeks of the year. The museum plans to hire a shop clerk, who will earn $110 per day, and an additional 20% of his salary in benefits. [Note: Round your answers to TWO decimal places. You can include symbols ($) or commas in your answers.] A) How many t-shirts must the shop sell in the first year if the goal is to break even? [Blank 1] B) How many t-shirts must the shop sell per week if the target profit is $120 per week? [Blank 2] C) Total fixed costs?

Answer rating: 100% (QA)

A BreakEven Point Number of TShirts To find the breakeven point we need to calculate the total reven... View the full answer