Question

Noodles & Company decided to offer franchises for a $35,000 up-front fee and 5% of their annual revenue. Units average more than $1,000,000 in annual sales. As a franchise,how much revenue must be submitted to Noodles & Company with annual sales of $989,675?

Answer 1

Yes, 5% of the the annual sales (i.e. $989,675) is the profit percentage that they need to pay up, but am confused whether you need to add the up-front fee as well to the 5%.