Question: Rio Coffee Shoppe sells two coffee drinksa regular coffee and a latte. The two drinks have the following prices and cost characteristics: Regular Coffee Latte

Rio Coffee Shoppe sells two coffee drinksa regular coffee and a latte. The two drinks have the following prices and cost characteristics:

Regular Coffee Latte
Sales price (per cup) $ 1.60 $ 2.90
Variable costs (per cup) 0.80 1.70

The monthly fixed costs at Rio are $5,984. Based on experience, the manager at Rio knows that the store sells 80 percent regular coffee and 20 percent lattes.

Required:

How many cups of regular coffee and lattes must Rio sell every month to break even?

Break-even Sales in Units
Regular coffee
Lattes

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