A cafe currently offers a cup of cafe latte for P100. The variable costs are P58 per cup, and 10,000 cups are sold annually and a profit of P200,030 is realized per year. A new design in making the coffee will increase the variable costs by 20% and Fixed Costs by 10% but sales will increase to 12,493 cups per year. If we employ the new design, at what selling price do we break even?
A cafe currently offers a cup of cafe latte for P100. The variable costs are P58 per cup, and 10,000 cups are sold annually and a profit of P200,030 is realized per year. A new design in making the coffee will increase the variable costs by 20% and Fixed Costs by 10% but sales will increase to 12,493 cups per year. If we employ the new design, at what selling price do we break even?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A cafe currently offers a cup of cafe latte for P100. The variable costs are P58 per cup, and 10,000 cups are sold annually and a profit of P200,030 is realized per year. A new design in making the coffee will increase the variable costs by 20% and Fixed Costs by 10% but sales will increase to 12,493 cups per year. If we employ the new design, at what selling price do we break even?
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