Question

Kelsey must pay $200 to rent a booth at the craft fair. The materials for each pendant cost $7.80, and she plans to sell each pendant for $13.50. To make a profit, she must make more money than she spends. Kelsey has already made 10 pendants. Part A Given that Kelsey has already made 10 pendants, how many additional pendants must she make and sell to make a profit of $50? More pendants to make a $50 profit

Answer 1

Answer:

Kelsey must produce 34 more pendants.

Step-by-step explanation:

Giving the following information:

Fixed costs= $200

Unitary variable cost= $7.8

Selling price per unit= $13.5

Desired profit= $50

To determine the number of units to be sold, we need to use the break-even point in units formula.

Break-even point in units= (fixed costs + desired profit) / contribution margin per unit

Break-even point in units= (200 + 50) / (13.5 - 7.8)

Break-even point in units= 250/5.7

Break-even point in units= 43.86 = 44

Kelsey must produce 34 more pendants.