How many pounds of coffee beans must be sold monthly

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Reference no: EM131259832

Scott and Tom are coffee roasters. They can roast up to 12,000 pounds of coffee beans monthly at their flagship store in Soho. However, they can only sell 3,000 pounds of coffee beans in the Soho store (flagship). Thus, Scott and Tom decided to open two additional retail stores where the remaining beans will be sold. In each of the two new stores they can only sell 4,500 pounds of coffee beans monthly. The fix costs of the flagship store are $45,000 and the fix costs of each of the retail stores are $15,000. The variable costs of producing a pound of coffee beans are $7 per pound. The variable selling costs are $3 per pound at the flagship store and $2 per pound at the two retail stores. There is enough demand in all of the stores to satisfy the selling capabilities of each store. Yet, Scott and Tom would like to first satisfy the sale in the flagship store before transferring products to the two retail stores. The average selling price for a pound of coffee beans is $18. The expenses listed so far do not include Scott and Tom’s salaries. If each owner requires a monthly salary of $6,000, how many pounds of coffee beans must be sold monthly?

Reference no: EM131259832

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