# accounting need help 461324

Pizza Pizazz is a local restaurant. Price and cost information follows:

Price per pizza ——–\$13.31

Variable cost per pizza

Ingredients——– 2.24

Direct labor——– 1.10

Fixed cost per month——-\$4,448.20

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1. Calculate Pizza Pizazz’s new break-even point under each of the following independent scenarios (Round your intermediate calculations to 2 decimal places and final answer to next whole number.):

a. Sales price increases by \$1.90 per pizza.

Break-even point:______units

b. Fixed costs increase by \$460.00 per month.

Break-even point:______units

c. Variable costs decrease by \$.45 per pizza.

Break-even point:______units

d. Sales price decreases by \$.60 per pizza.

Break-even point:______units

2: Assume that Pizza Pizazz sold 475 pizzas last month. Calculate the company’s degree of operating leverage. (Round your intermediate calculations and final answer to 2 decimal places)

Degree of operating leverage:________

3: Using the degree of operating leverage, calculate the impact on profit caused by a 13.00 percent increase in sales revenue. (Round your intermediate calculations and final answer to 2 decimal places. Omit the “%” sign in your response.)

Effect on profit:_______%

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