Question: - Question 57 (8 points) Jack and Susan are young entrepreneurs who have decided to build and sell kites to children at the Forks this
- Question 57 (8 points) Jack and Susan are young entrepreneurs who have decided to build and sell kites to children at the Forks this coming summer. They know that it will cost $1200 to rent a stall for the entire summer and they will also spend $300 on advertising. The cost of the materials per kite are as follows: Glue $0.03 Wood for the kite frame $0.35 Plastic $0.10 String $0.02 They decide that they want to hire their friend Jason to sell the kites for them and he will be the only sales person who staffs the retail stall. Jason will be paid a $1.00 commission for each kite he sells. They intend to charge $10.00 per kite. a) What is their contribution margin per kite in dollars? (2 marks) b) What is the break even in units? (2 marks) c) What would the break even in dollars be if the price was reduced by 10%? (4 marks)
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