The Owner of an Ice Cream Franchise Must Pay the Parent

Multiple Choice

The owner of an ice cream franchise must pay the parent company $1,100 per month plus 5% of the monthly revenue R. Operating cost of the franchise includes a fixed cost of $2,500 per month for items such as utilities and labor. The cost of ice cream and supplies is 50% of the revenue. Determine the monthly revenue needed to break even.

A) $3,600
B) $1,620
C) $1,400
D) $8,000
E) $6,545