Answered

A small fast-food restaurant invests $5000 to produce a new food item that will sell for $3.49. Each item is to be produced for $2.16. How many items must be sold to profit $8500



Answer :

sqdancefan

Answer:

  10151

Step-by-step explanation:

You want to know the number of items costing 2.16 that must be sold for 3.49 to recover an investment of 5000 and make a profit of 8500. (Amounts in dollars.)

Contribution

The contribution margin of each item is ...

  3.49 -2.16 = 1.33

The total wanted from sales is ...

  5000 +8500 = 13,500

Then the number that must be sold is ...

  13500/(1.33/item) = 10,150.38 items ≈ 10151 items

About 10,151 items must be sold to make a profit of 8500 dollars.

Other Questions