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Calculate the minimum price per cone for this special order

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Question - The cone Head House sells ice-cream cones in a variety of flavours. Financial data for a recent week are shown below:

Revenue (1000 cones @$2.00) $2000

Cost of ingredients 600

Rent 350

Store attendant 650

Profit 400

The cone head's manager received a call from a university student club requesting 100 cones to be picked up in three days. The cones could be produced in advance by the store attendant during slack periods, and then sorted in the freezer. Each cone requires a special plastic cover that costs $0.10

Required -

A. Discuss the quantitative information relevant to this decision.

B. Calculate the minimum price per cone for this special order.

C. Explain why the cone head house manager might be willing to sell cones at the minimum selling price you calculated in part (b).

Reference no: EM132648660

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