Part 1) Donald sells hot dogs at $3.00 with a variable cost of 60 cents. Considering his fixed costs for the month are $2300 How many hot dogs must he sell to break even?
A: He must sell 985.33 or 959 hot dogs to break even
Part 2) Donald now adds chips to every hot dog he sells for an extra $1.00 at a cost of 30 cents. Now 80% of his unit sales are hot dogs and 20% are chips. How many hot dogs and chips must he sell to break even for the month (Fixed costs remain at $2300).