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Coe College Operations And Supply Chain Management Assignment Help - Lugano's Pizza Parlor


Question - Lugano's Pizza Parlor is considering the purchase of a large oven and related equipment for mixing and baking "crazy bread." The oven and equipment would cost $143,200 delivered and installed. It would be usable for about 15 years, after which it would have a 10% scrap value. The following additional information is available: a. Mr. Lugano estimates that purchase of the oven and equipment would allow the pizza parlor to bake and sell 80,000 loaves of crazy bread each year. The bread sells for $1.35 per loaf. b. The cost of the ingredients in a loaf of bread is 40% of the selling price. Mr. Lugano estimates that other costs each year associated with the bread would be as follows: salaries, $25,000; utilities, $3,000; and insuranc ...Read More

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