CASE NOTES:

At Isabella's current location, she has been using a convection oven. She is concerned that this method is not cost efficient, especially with the higher volume of business she is expecting at the new location.

There are three choices of pizza ovens as outlined to the right. (Note: The production time per pizza has no bearing on the cross-over calculations, but may be important in setting up her kitchen process in Part 4 of the case.)

For the analysis complete the following:

14720 is the number of pizza's expected to sell in 2021 (with the Average cost per pizza of $25)

-Calculate the exact Crossover points mathematically for the three oven options.

-Compare two ovens at a time.

-Set the cost formula's equal to each other & solve for X number of pizzas.

-Graph the data to demonstrate a visual depiction of the cross-over quantity points.

-Set up the pizza quantity starting with zero & increasing incrementally above the number she expects to sell.

-Determine the correct equipment choice based on the crossover points & the expected 2021 pizza sales.

Isabella's Pizza Oven Choices & Costs:
	OVEN TYPE	PIZZA OVEN THROUGHPUT TIME	FIXED COST	VARIABLE EST. OPERATING COST/PIZZA
	Convection Oven	10 MIN/PIE	$ 1,500.00	$ 1.75
	Pizza Deck Oven	3.75 MIN/PIE	$ 6,000.00	$ 0.85
	Conveyor Oven	1.5 MIN/PIE	$ 10,500.00	$ 0.45