Backstreets make month in order for service to break even

Assignment Help Operation Management

Reference no: EM13992185

The owner of backstreet’s Italian restaurant are considering starting a delivery service for pizza and their are other Italian dishes in the small college town where they are located. They can purchase a used delivery van and have it painted with their name and logo for $21,500. They can hire part-time drivers who work in the evenings from 5 PM to 10 PM for eight dollars per hour. The drivers are mostly college students who study at the restaurant when they are not making deliveries. During the day, there are so few deliveries that the regular employees can handle them. The owners estimate that the van will last 5 years(365 days per year) before it has to be replaced and that each delivery will cost about one dollar and $1.35 in gas and other maintenance costs (including tires, oil, scheduled service etc). They also estimate that on average each delivery order will cost $15 for direct labor and ingredients to prepare and package, and will generate $34 in revenue.

How many delivery orders must backstreets make each month in order for the service to break even?

Reference no: EM13992185

Questions Cloud

Strong opposition to the trade union movement : In no more than 100 words, address why you think there has been (and still is) such strong opposition to the trade union movement by American business management and how this opposition affects the aviation industry.

The average number of customers waiting for a haircut : Benny the Barber owns a barber shop with two-chairs (stations for two barbers). However, he is the only barber working there at this time. His customers are arriving at the rate of one every thirty minutes. The average number of customers waiting for..

What is its multifactor productivity : Airphone, Inc., manufactures cellular telephones at a processing cost of $47 per unit. The company produces an average of 250 phones per week although there are 16% defective phones. Each phone takes one hour to make. What is the company's labor hour..

Forecast values based on simple moving average method : While monitoring the forecast values based on simple moving average method (averaging period = 3), the tracking signals are consistently coming out as large positive numbers (i.e., 4.0, 6.2, and 5.5). What should we do to the forecast model?

Backstreets make month in order for service to break even : The owner of backstreet’s Italian restaurant are considering starting a delivery service for pizza and their are other Italian dishes in the small college town where they are located. How many delivery orders must backstreets make each month in order..

What is the average multi-factor productivity for process : Operation management 11th edition Stevenson, William. solution for this problem; The weekly output of a production process is shown below, together with data for labor and material inputs. Assume a 40-hour week and an hourly wage of $16. Material cos..

Estimates the size and sales potential of market segments : A(n) _____ describes and estimates the size and sales potential of market segments of interest to the firm and assesses key competitors in these market segments.

Discuss how changes in the demographic composition : Discuss how changes in the demographic composition of the U.S. workforce will affect the employment relationship from an employer’s perspective. What possible impact will these changes have on employee-benefits practices?

What environmental factors-internal and external : Environmental Factors. What environmental factors - internal and external - could impact the recruitment, selection, and retention of this position? How can you set your organization apart from others in the marketplace, thus attracting the best cand..

User Account

All Pages