this is all the information that is given, this is exactly from the book.

Case study: Triple P Pizza Pete and Peggy Peterson are planning their retirement. They have always enjoyed cooking and over the years have developed a pizza that has been the talk of their small town. Everyone has told them for years, "You should just stop working and sell pizzas to local residents and groups." They reside in a small town that is located several miles from the nearest town and would have very little competition. As Pete and Peggy transition into retirement they decide to try their luck and start a small take-out pizza shop. They plan to name it Triple P Pizza. They remodeled their garage and Peggy plans to start by using her own kitchen utensils. They estimate their fixed costs will be $5,500. They estimate their cost of goods sold to be $5.55 per pizza. They estimate other costs that will vary with production will be $1.95 per pizza. They think they could sell 50 pizzas a week or 2,600 per year for a selling price of $10.00 per pizza. They have decided to use volume cost analysis to cyaluate their nlans 4. Pete and Peggy are considering the purchase of some new restaurant cooking equipment and expect the additional capital needed to be about $5,000, including installation. Pete assumes this new equipment can be depreciated over a five-year period. If the depreciation for the equipment is equal each year and there is no salvage value, what additional sales will Triple P need for this to be a profitable decision? Assume no other changes will be made to the base situation. Answer this question in both number of pizzas and in dollars. 5. Pete and Peggy are interested in ways for Triple P to increase sales. One change they are considering is to reduce the selling price for their pizzas. They hope this change will increase sales in the near term and help them maintain sales later if a competitor should enter the market. What would the impact of a 10 percent price reduction have on the business? Assume no other changes are made to the base situation in question 1. Answer this question in number of pizzas and in dollars. 1. Calculate the breakeven point for Triple P Pizza in dollars and in pizzas. Variable cost per unit = $5.55 +$1.95 = $7.50 Contribution per unit = $10 - $7.50 = $2.50 per unit PV ratio = $2.50/10.00 - 100 = 25% Annual Fixed Cost = $5500 Break even in units = 5500/2.50 = 2200 Units Break even in $ - 5500/25%-$22000 I 2. The owners, Pete and Peggy Peterson, have about $10,000 invested in the business. Their desired rate of return on this investment is 10 percent. What volume of business (again, in dollars and in pizzas) must be generated to reach this ROE goal? 3. Pete would like to start a delivery service and hire some part-time labor, which amounts to an increase in variable costs of $0.50/pizza. With no other changes to the base situation, what impact would this have on the business? Show your answer in dollars and in pizzas. Case study: Triple P Pizza Pete and Peggy Peterson are planning their retirement. They have always enjoyed cook- ing and over the years have developed a pizza that has been the talk of their small town. Everyone has told them for years, "You should just stop working and sell pizzas to local residents and groups." They reside in a small town that is located several miles from the nearest town and would have very little competition. As Pete and Peggy transition into retirement they decide to try their luck and start a small take-out pizza shop. They plan to name it Triple P Pizza. They remodel their garage and Peggy plans to start by using her own kitchen utensils. They estimate their fixed costs will be $5,500. They estimate their cost of goods sold to be $5.55 per pizza. They estimate other costs that will vary with production will be $1.95 per pizza. They think they could sell 50 pizzas a week or 2,600 per year for a selling price of $10.00 per pizza. They have decided to use volume- cost analysis to evaluate their plans. Questions 1. Calculate the breakeven point for Triple P Pizza in dollars and in pizzas. 2. The owners, Pete and Peggy Peterson, have about $10,000 invested in the business. Their desired rate of return on this investment is 10 percent. What volume of busi- ness (again, in dollars and in pizzas) must be generated to reach this ROE goal? 3. Pete would like to start a delivery service and hire some part-time labor, which amounts to an increase in variable costs of $0.50/pizza. With no other changes to the base situation, what impact would this have on the business? Show your answer in 4. Pete and Peggy are considering the purchase of some new restaurant cooking equip- ment and expect the additional capital needed to be about $5,000, including installation. Pete assumes this new equipment can be depreciated over a 5-year period. If the depreciation for the equipment is equal each year and there is no dollars and in pizzas. salvage value, what additional sales will Triple P need for this to be a profitable deci sion? Assume no other changes will be made to the base situation. Answer this question in both number of pizzas and in dollars. 5. Pete and Peggy are interested in ways for Triple P to increase sales. One change they are considering is to reduce the selling price for their pizzas. They hope this change will increase sales in the near term and help them maintain sales later if a competitor should enter the market. What would the impact of a 10 percent price reduction have on the business? Assume no other changes are made to the base situation in question 1. Answer this question in number of pizzas and in dollars