On-the-Go (OTG) is a convenience store with 100 locations across the US. The CFO of OTG,...

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On-the-Go (OTG) is a convenience store with 100 locations across the US. The CFO of OTG, Trey Trammel, is considering offering new products/services at OTG locations. b) Trammel is considering offering a money order service, much like a bank would offer. He's hoping it would bring additional customers into the store, who may buy other items while there. Decisions to add products or services can be complex. The following information is available to help you determine if OTG should begin selling money order services at its stores. The cost of renting the money order machine is $10/month/store. The machines also require additional monitoring by the security company that monitors the convenience stores, which will cost $15/month extra. The current cost of security monitoring is $50/month OTG would have to pay a $.05 processing fee for each money order that's processed at its locations. Competition (local banks) typically charge customers $.99/money order processed, OTG would like to charge $89 for each money order to bring in more business and undercut the competition. Money order processing would also take longer at the registers. Trammel plans to hire an additional worker to handle all money orders at $1,200/month salary. MONEY ORDERS: How many money orders does each OTG location need to sell per month to break even? MONEY ORDERS: How many to earn a profit on money orders of $1,000 for the month? On-the-Go (OTG) is a convenience store with 100 locations across the US. The CFO of OTG, Trey Trammel, is considering offering new products/services at OTG locations. b) Trammel is considering offering a money order service, much like a bank would offer. He's hoping it would bring additional customers into the store, who may buy other items while there. Decisions to add products or services can be complex. The following information is available to help you determine if OTG should begin selling money order services at its stores. The cost of renting the money order machine is $10/month/store. The machines also require additional monitoring by the security company that monitors the convenience stores, which will cost $15/month extra. The current cost of security monitoring is $50/month OTG would have to pay a $.05 processing fee for each money order that's processed at its locations. Competition (local banks) typically charge customers $.99/money order processed, OTG would like to charge $89 for each money order to bring in more business and undercut the competition. Money order processing would also take longer at the registers. Trammel plans to hire an additional worker to handle all money orders at $1,200/month salary. MONEY ORDERS: How many money orders does each OTG location need to sell per month to break even? MONEY ORDERS: How many to earn a profit on money orders of $1,000 for the month?

Answer rating: 100% (QA)

a To determine how many money orders each OTG location needs to sell per month to break even we need ... View the full answer