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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 relatively 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.

Required:
(a)	Calculate the total contribution margin generated by the normal volume of medium pizzas in a week.

Contribution margin

(b)	Calculate the total number of medium pizzas that would have to be sold during the 1-cent sale to generate the same amount of contribution margin that results from the normal volume.

Number of pizzas

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9960176

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