Assume Domino's Pizza has the following monthly revenue and cost functions: Total Revenue= $10.00x Total Cost=...

Assume Domino's Pizza has the following monthly revenue and cost functions:

Total Revenue= $10.00x Total Cost= $16000+$4.00x

a. Prepare a graph illistrating Domino's cost-volume-profit relationship. The vertical axis should range from $0 to $72,000, in increments os $12,000. The horizontal axis should range from 0 units to 6,000 units, in increments of 2,000 units.

b. Prepare a graph illustrating Domino's profit-volume relationship. The horizontal axis should range from 0 units to 6,000 units, in increments of 2,000 units.

c. When is it most appropriate to use a profit-volume graph?

Expert Solution

(c) Point (b) is appropriate to show the profit volume garph. It shows whenever we increase volume profit will increase sharply. Graph in point (a) appropriate where company is working at very low margin and there is chances in reduction of profit or working at break even point.

ekkarill92 answered 1 year ago

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