Aunt Connie's Cookies Contribution Margin and Break-Even AnalysisAunt Connie's Cookies is a brand synonymous with delicious lemon curd and real mint cookies throughout the East and Midwest. Aunt Connie's Cookies was founded in 1986 after a friend of Aunt Connie's urged her to take her business and baking skills to the public. The Aunt Connie's brand found success producing lemon cream and real mint cookies. Maria Villanueva is the current general manager of this family business. Maria was considering a large biscuit production order, the takeover of competitors, and the difficulty of meeting demand for biscuits and operating as a profitable entity. Maria must make a decision to:1. Make or buy2. Sell ​​or process more3. Retain or replace equipment4. Eliminate an unprofitable business segment5. Allocate limited resourcesThe notion of contribution is important for the decision to be made. Real Mint offers a greater total contribution margin while Lemon Crème offers a greater unit contribution margin. To be able to take the order, one or both of the cookie productions will need to be reduced so that that energy is devoted to fulfilling the bulk order. . The main idea here is to maximize operating profits, because it is better to produce more of the product that provides the greatest unit contribution margin. By keeping the Lemon Crème cookies at the same level, no unnecessary operating profits would be lost and the increase in Real Mint's order generates a greater amount of revenue than would have been in a normal month of production . If the bulk order had been for the Lemon Crème cookies, it may have been more difficult to achieve and the end result was just as desirable. The Real Mint...... middle of document ......The three key learning points identified are break-even, variable cost and fixed cost. They will be important in making the decision because Mr. Shultz needs to know how many items he needs to sell before he can see each store's profit. Variable costing is important because cost affects profitability and details management strategies to improve profits. Finally, fixed costs are important because they must be paid regardless of sales volume. Fixed costs include, but are not limited to, overhead costs (rent, insurance, etc.), but may include direct costs such as payroll. The overall importance of break-even point, variable costs and fixed costs is equally important for any business decision making. ReferenceDatamonitor. (January 2005). Starbucks Company. Retrieved September 22, 2006 from http://www.investor.reuters.com from the University of Phoenix Library..