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Special promotion- expects of a 1 cent sale.

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The management of Rocko's Pizzeria is considering a special promotion for the last two weeks of October, which is normally a low demand period. The special promotion would involve selling two medium pizzas for the price of one, plus 1 cent. The medium pizza normally sells for $ 12.99 and has variable expenses of $4.50. Expected sales volume without the special promotion is 600 medium pizzas per week.

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The management of Rocko's Pizzeria is considering a special promotion for
the last two weeks of October, which is normally a low demand period. The
special promotion would involve selling two medium pizzas for the price of
one, plus 1 cent. The medium pizza normally sells for $ 12.99 and has
variable expenses of $4.50. Expected sales volume without the special
promotion is 600 medium pizzas per week.

a) Calculate the total contribution margin generated by the normal
volume of medium pizzas in a week
Selling Price = $12.99
Variable Expenses = $4.50 ...

Solution Summary

The solution examines a special promotion for a 1 cent sale. The expected sales value without the special promotion is given.

$2.19