Home School Life Journal From Preschool to High School

Home School Life Journal ........... Ceramics by Katie Bergenholtz
"Let us strive to make each moment beautiful."
Saint Francis DeSales

Money Matters: Setting Tostada Prices

The Rosadas decided to sell each of their tostadas for the same price, regardless of the combination of toppings a customer selected Now that the business has been going along successfully  they want to know how much each of the different tostadas actually cost to prepare so that they can analyze their profit margin and adjust the cost as necessary. Based on the cost of the ingredients they want to know how much each tostada costs to prepare The based on what the students advise them to do , the Rosadas may need to change their prices.

Last week the boys determined the prices of each tostada, given the cost of the ingredients. This week they calculated the average (or mean) cost. The Rosadas have determined that they sell almost an equal number of each combinations every day. They also let us know that in the restaurant business owners need to charge three times the cost of the ingredients in order to pay for such things as rent utilities, salaries and to make a profit They decided to triple the cost of each tostada combination, add them together and then divide that number by the number of combinations. There are other ways of coming to this average, but their way did work. They came up with the average cost of $3.32, which they wanted to suggest to the Rosadas that they should make the price $3.35 as it is a more usual price. (Rounding down to $3.30 would also be a good answer.) Next week the Rosadas will expand their menu to include combination plates, and will need more help from the boys to figure out what to charge for them.

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