Final answer:
To calculate the profits of Ms. Sprinkle's donut shop, subtract the total costs from the total revenue. The total revenue is the number of donuts sold multiplied by the selling price, and the total costs are the cost of ingredients plus the rent and overhead expenses. Therefore, none of the provided options (a, b, c, d) are correct.
Step-by-step explanation:
To calculate the profits of Ms. Sprinkle's donut shop, we need to subtract the total costs from the total revenue. The total revenue can be found by multiplying the number of donuts sold (100,000) by the selling price ($0.25). The total costs can be found by adding the cost of ingredients ($0.05 per donut) to the rent and overhead expenses ($2,000 per month).
Total revenue = 100,000 * $0.25 = $25,000
Total costs = 100,000 * $0.05 + $2,000 = $7,000
Profits = Total revenue - Total costs = $25,000 - $7,000 = $18,000
Therefore, the profits of Ms. Sprinkle's donut shop in the last month were $18,000.
Ms. Sprinkle's profits from selling 100,000 donuts are $18,000, as none of the provided options match this calculation. To determine this, the total revenue was calculated and then both ingredient costs and overhead expenses were subtracted.
Ms. Sprinkle runs a donut shop and needs to calculate her profits from the previous month. To calculate the profit, you subtract total costs from total revenues. With each donut costing $0.05 to make and selling for $0.25, the profit per donut is $0.25 - $0.05 = $0.20. Selling 100,000 donuts means a total revenue of 100,000 donuts × $0.25 = $25,000. The total cost of ingredients is 100,000 donuts × $0.05 = $5,000, and overhead expenses are $2,000 for the month. The profit is calculated by taking the total revenue of $25,000 minus the sum of ingredient costs ($5,000) and overhead ($2,000), equaling $25,000 - $5,000 - $2,000 = $18,000. Therefore, none of the provided options (a, b, c, d) are correct.