Question

Jan Green plans to sell blueberry pies at a local farmer's market. The permit and space...

Jan Green plans to sell blueberry pies at a local farmer's market. The permit and space rental will cost her $2,200 for the June through August season. She expects to have an average variable cost of $2.15 per pie and expects to sell 900 pies per month. Betty also expects all other fixed costs to be $3,000 for the entire season. If she wants to realize a $12,000 profit, how much should she sell each pie for? Assume no sales tax (round to the nearest penny and enter answer like this $9.46)

Homework Answers

Answer #1
Total fixed cost:
Permit and space rental cost 2200
Other fixed ccost 3000
Total fixed cost 5200
Total Desired contribution:
Total fixed cost 5200
Desired profits 12000
Total desired contribution 17200
Divide: Number of unist 900
Desired contribution per unit 19.11111
Selling price per unit:
Variable cost per unit 2.15
Desired contribution per unit 19.11
Selling price per unit: 21.26
Selling price per pie shall be $ 21.26
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