ACT 310 Managerial Accounting Homework- American University of the Middle East
Question I
Gary's Pizza delivers pizzas to residences and apartments near a major state university. The company's annual fixed costs are $72,000. The sales price averages $18, and it costs the firm $6 to make and deliver each pizza.
Required:
i. Determine how many pizzas must Gary sell to break even?
ii. Determine many pizzas must the company sell to earn a target profit of $54,000?
iii. If budgeted sales total 8,500 pizzas, determine how much is the company's safety margin in dollars?
Question II
ABC Corporation's product code. A132 has a negative contribution margin. How can such a situation arise? Should the company continue to stock and sell this product? Explain.
The response must include a reference list. One-inch margins, double-space, Using Times New Roman 12 pnt font and APA style of writing and citations.