Beckie have to sell in oder to break-even

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Reference no: EM132105726

Beckie wants to open her own business, Beckie’s Lemonade Stand. Bobby, Beckie big brother, has told Beckie that he can purchase the necessary material and build the Lemonade stand for $30. Beckie asks you to run the numbers before she begins. Beckie tells you that if will cost $0.30 to make each cup of lemonade, and she plans on selling each glass of lemonade for $0.50.

A. How many glasses of lemonade will Beckie have to sell in order to break-even?

After looking at the required number of glasses of lemonade that Beckie would need to sell before she broke even, Beckie is disheartened and about to give up on her entrepreneurial venture when Bobby tells her that he can get some old scrap wood instead of new lumber to make her lemonade stand. Bobby says that if he uses the scrap wood the cost to build the stand will go down to $15. Based on the change in the cost to build the lemonade stand, Beckie asks you to determine the new break-even point. The selling price per glass is $0.50 and the cost per glass is $0.30.

B. Now, how many glasses of lemonade will Beckie have to sell in Oder to break-even?

Ask you explain the new break-even point Beckie seems encouraged, but she doesn’t want to just break-even she wants to make a profit. Beckie decides she would like to make at least a nickel of profit for every glass she sells. Before she even asks, you start some new calculations.

C. Given the cost to build the stand will be $15, the selling price$0.50 per glass, the cost to make each glass of lemonade is $0.30, and Beckie wants to make a profit of $0.05 on each glass, how many glasses of lemonade would Beckie have to sell?

Reference no: EM132105726

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