Snowies, owned by Carl and Gordon Rupp, is a company that provided training, equipment, and supplies...

 

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Snowies", owned by Carl and Gordon Rupp, is a company that provided training, equipment, and supplies for operating a shaved ice business. Shaved ice is an ice-based refreshment made by shaving a block of ice into a fluffy, snow-like ice. The product is served in cups with flavored syrups added to the ice. Due to its fine texture, shaved ice absorbs the syrup, making each bite flavorful. Snowie does not sell franchises. It sells a wide array of equipment and supplies, including ice shavers, kiosks, carts, buses, syrups, cups, and other supplies to independent operators. Assume that you are evaluating whether to start a Snowie business. You could operate a shaved ice kiosk at fairs, downtown areas, and other outdoor events. The kiosk is portable with wheels and a hitch. It has plenty of storage place, work area, electrical outlets, lighting, and a water system. The flavored shaved ice, a "Snowie," is normally offered in three sizes. For this case, we are going to assume that only one size is offered - the large size, 20 oz. The large Snowie sells for US$4.00. See the following page for a list of all costs related to a large size Snowie. In this case, use straight-line depreciation with a five-year life and salvage values of zero for both the ice shavers and the flavor station. All monetary amounts in this case are expressed in U.S. dollars. In your calculations, specify your assumptions about the following items: I a. Number of days you anticipate opening the Snowie kiosk per month, b. Number of hours you will work (no wages required) per day c. Number of hours you will pay an employee to work in the Snowie kiosk per day Make the above figures dynamic, such that if you can change them the answers will also change. Answers needed: a. What is the contribution margin per snow cone? b. How many snow cones must be sold each month to break even? How many snow cones is that on a per day and per hour basis? If this does not seem reasonable based on your assumptions, adjust your assumptions. How many snow cones must be sold to achieve an operating profit of $2000 per month (before tax)? How many snow cones is that on a per day and per hour basis? If this does not seem reasonable based on your assumptions, adjust your assumptions. C. Snowies", owned by Carl and Gordon Rupp, is a company that provided training, equipment, and supplies for operating a shaved ice business. Shaved ice is an ice-based refreshment made by shaving a block of ice into a fluffy, snow-like ice. The product is served in cups with flavored syrups added to the ice. Due to its fine texture, shaved ice absorbs the syrup, making each bite flavorful. Snowie does not sell franchises. It sells a wide array of equipment and supplies, including ice shavers, kiosks, carts, buses, syrups, cups, and other supplies to independent operators. Assume that you are evaluating whether to start a Snowie business. You could operate a shaved ice kiosk at fairs, downtown areas, and other outdoor events. The kiosk is portable with wheels and a hitch. It has plenty of storage place, work area, electrical outlets, lighting, and a water system. The flavored shaved ice, a "Snowie," is normally offered in three sizes. For this case, we are going to assume that only one size is offered - the large size, 20 oz. The large Snowie sells for US$4.00. See the following page for a list of all costs related to a large size Snowie. In this case, use straight-line depreciation with a five-year life and salvage values of zero for both the ice shavers and the flavor station. All monetary amounts in this case are expressed in U.S. dollars. In your calculations, specify your assumptions about the following items: I a. Number of days you anticipate opening the Snowie kiosk per month, b. Number of hours you will work (no wages required) per day c. Number of hours you will pay an employee to work in the Snowie kiosk per day Make the above figures dynamic, such that if you can change them the answers will also change. Answers needed: a. What is the contribution margin per snow cone? b. How many snow cones must be sold each month to break even? How many snow cones is that on a per day and per hour basis? If this does not seem reasonable based on your assumptions, adjust your assumptions. How many snow cones must be sold to achieve an operating profit of $2000 per month (before tax)? How many snow cones is that on a per day and per hour basis? If this does not seem reasonable based on your assumptions, adjust your assumptions. C.

Answer rating: 100% (QA)

Solution Stage 1 Figuring of Variable Expense of Snowie Ice Per Snowie 020 Spoon Straw 002 Styrofoam cup 008 Napkin 001 Total 031 Stage 2 Computation ... View the full answer