Bob is considering opening a bakery that will sell a single type of bread. He is working on abusiness modeland wants to discover whether this venture is financially viable - and when it would become profitable. Here is a breakdown of his financials:

Fixed costs (monthly)

Variable costs (per loaf)

Selling price (per loaf)

Rent

$2,500

Flour

$0.50

Insurance

$250

Water

$0.25

Utilities

$250

Salt

$0.10

Advertising

$500

Yeast

$0.15

Total

$3,500

Total

$1

Total $5

$5

Using the break-even point formula, he wants to calculate the number of loaves the bakery will need to sell each month in order to cover all expenses.

Calculate the break-even point.

Assume Bob's bakery sold 700, 750, and 900 loaves during the first three months respectively. What is the total profit or loss did the bakery make in each of the three months?

Assume Bob has an objective of making an annual profit of $6000 during the first year, how many loaves does he need to sell to reach that objective?

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