Refer to Scenario 9

question 16

Multiple Choice

Refer to Scenario 9.8 below to answer the question(s) that follow.
SCENARIO 9.8: Investors put up $1,040,000 to construct a building and purchase all equipment for a new gourmet cupcake bakery. The investors expect to earn a minimum return of 10 per cent on their investment. The bakery is open 52 weeks per year and sells 900 cupcakes per week. The fixed costs are spread over the 52 weeks (i.e. prorated weekly) . Included in the fixed costs is the 10% return to the investors and $2,000 in other fixed costs. Variable costs include $2,000 in weekly wages, and $600 per week in materials, electricity, etc. The bakery charges $8 on average per cupcake.
-Refer to Scenario 9.8. Total cost per week is

• A) $1,600.
• B) $2,000.
• C) $5,000.
• D) $6,600.

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Definitions:

Dents

Minor physical damage or deformities often resulting from impact, which can occur on surfaces or objects such as vehicles, appliances, or phones.

Scratches

Marks or superficial injuries caused by something sharp or abrasive, affecting surfaces or skins.

Desk Pieces

Items or accessories placed on a desk for functional or decorative purposes, often used in professional settings.

Intermediaries

Agents or businesses that act as a middleman in the distribution process or transactions between producers and consumers.