th Owner Sung Chi is considering franchising her Oriental Express restaurant concept. She believes people will...
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th Owner Sung Chi is considering franchising her Oriental Express restaurant concept. She believes people will pay $6.00 for a large bowl of noodles. Variable costs are $2.10 a bowl. Chi estimates monthly fixed costs for franchisees at $7,800. Read the requirements. Requirement 1. Find a franchisee's breakeven sales in dollars. Begin by identifying the formula to compute the sales in units at various levels of operating income using the contribution margin approach. Fixed expenses Operating income >/ Contribution margin ratio Breakeven sales in dollars The breakeven sales in dollars is $ Requirement 2. Is franchising a good idea for Chiif franchisees want a minimum monthly operating income of $6,500 and Chi believes that most locations could generate $25,000 in monthly sales? The target sales in dollars to reach the minimum monthly operating income for franchises is $ Sung Chi's franchising concept idea. She expects most locations the sales required to earn the target profit. th Owner Sung Chi is considering franchising her Oriental Express restaurant concept. She believes people will pay $6.00 for a large bowl of noodles. Variable costs are $2.10 a bowl. Chi estimates monthly fixed costs for franchisees at $7,800. Read the requirements. Requirement 1. Find a franchisee's breakeven sales in dollars. Begin by identifying the formula to compute the sales in units at various levels of operating income using the contribution margin approach. Fixed expenses Operating income >/ Contribution margin ratio Breakeven sales in dollars The breakeven sales in dollars is $ Requirement 2. Is franchising a good idea for Chiif franchisees want a minimum monthly operating income of $6,500 and Chi believes that most locations could generate $25,000 in monthly sales? The target sales in dollars to reach the minimum monthly operating income for franchises is $ Sung Chi's franchising concept idea. She expects most locations the sales required to earn the target profit.
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Related Book For
Managerial Accounting
ISBN: 978-0176223311
1st Canadian Edition
Authors: Karen Wilken Braun, Wendy Tietz, Walter Harrison, Rhonda Pyp
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