Homework help!
You decide to invest in a hot dog stand. The stand is open daily from 11:00 to 3:00 during the tourist season (September to May), and you are closed during the summer months. You’ve been thinking that you may need to add turkey hot dogs to your menu and you are trying to determine an initial retail price. You would like to make $20,000 from the turkey hot dogs, however you know that you will have to price the dogs low initially to get folks to try them. You must get people to try the dogs and you will use price as an incentive. You determine that you will have to give $1,000 in reductions to sell the dogs during these periods. You forecast that you will increase net sales by $40,000 by carrying the turkey hot dog. The cost for making each dog is .50. The fixed costs for the “turkey dogs” are $10,000. The .50 cost of the hot dog mentioned earlier is the variable cost per unit.
I need to know the
1. Break even point in dollars
2. Break even point in units
3. Initial markup
4. Suggested retail price based on initial markup.
FyingTerror12
1 year ago
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