Project Narrative: This summer you’ve decided to take on a new venture. After the spring semester ends, you’re returning to your hometown for a few weeks. A local church is running its annual carnival and has offered you an opportunity to set up a booth. You have the chance to relive some of your favorite childhood food memories! In your booth space, you can sell any food item you wish (i.e. candied apples, cotton candy, poutine, lemonade, funnel cake, deep-fried Snickers). The carnival will run in the evenings for six days; each evening from 6:00 pm – 10:00 pm. As operator of this booth, you will need to buy all the materials, hire all of your labor (if needed), and pay 12.5% of your sales revenue to N&A Amusement Company and 12.5% of your sales revenue to the church. Additionally, you are required to pay the church a $200 rental cost (which includes utilities expense) for the booth space. You are very excited to put your managerial accounting skills and other business courses to use during the summer. In order to make this opportunity a good use of your time, you need to determine the feasibility/profitability of this venture. If successful, a good portion of the money you earn in the summer can go towards your college education (or that much needed trip to someplace tropical!).
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