Answer:
Location A: 18,125.00
Location B: 18,593.75
Location C: 18,906.25
Explanation:
We solve for the contribution per sandwich:
2.40 selling price - 1.60 variable cost = 0.80 contribution per sandwich
We now, divide the fixed cost and mtarget profit over the contribution to get the amount of sandwhich needed to achieve it.
[tex]\frac{Fixed\:Cost + target \: profit}{Contribution \:Margin} = Sales\: to\: Profit_{units}[/tex]
Location A:
[tex]\frac{5,250 + 9,250}{0.80} = Break\: Even\: Point_{units}[/tex]
18,125
Location B:
[tex]\frac{5,625 + 9,250}{0.80} = Break\: Even\: Point_{units}[/tex]
18593,75
Location C:
[tex]\frac{5,875 + 9,250}{0.80} = Break\: Even\: Point_{units}[/tex]
18906,25