Solution-Expected to affect leo business

Expected to affect leo business

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Reference no: EM131074051

Uncle Leo's Pizza is a sole proprietorship owned by Leo Sienfeld. Uncle Leo delivers pizzas to dormitories and apartments near a major state university. In 2014, the company's annual fixed expenses were $50,000, its sales price per pizza was $12, and it costs the company $6 to make and deliver each pizza. In 2014, Uncle Leo's sold 60,000 pizzas and made $310,000 before taxes.

Three major changes are expected to affect Leo's business in 2015 (a): increased competition is going to force him to drop his pizza cost to $11, (b) changes in his dough cost is going to drive his variable cost to $7 per pizza, and (c) the landlord is raising the rent, driving his fixed costs to $70,000 per year. How many pizzas will Uncle Leo need to sell to make $310,000 before taxes in 2015?

Reference no: EM131074051

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Expected to affect leo business : Three major changes are expected to affect Leo's business in 2015 (a): increased competition is going to force him to drop his pizza cost to $11, (b) changes in his dough cost is going to drive his variable cost to $7 per pizza, and (c) the landlo..

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Expected to affect leo business

Reference no: EM131074051

Reference no: EM131074051

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