Mathematics, 13.04.2021 16:10 mikecampbellashleyca
Case: Your group is providing assistance to an entrepreneur planning to start a new business. The group wants to check the feasibility of renting in-line skates to individuals and small groups. To determine this, you need to calculate the break-even point in unit and dollar sales for the year based on the following projections:
Rent$ 12,000
Insurance 600
Equipment loan payment (non-skate) 2,400
Utilities (electric, phone, water) 1,440
Wages and salaries 27,600
Advertising 960
Each pair of in-line skates will cost the business $90. The first yearâs inventory will consist of 50 pairs.
The projected average sale is $10 per rental. With a six-day-a-week operation, your group projects an average rental of 30 pairs a day, producing sales of $1,800 per week.
Questions:
1.How much are the total fixed costs?
2.How much are total variable costs?
3.What is the variable cost per unit?
4.What is the variable-cost margin?
5.What is the break-even point in units?
6.What is the break even point in dollars?
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Answers: 3
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Case: Your group is providing assistance to an entrepreneur planning to start a new business. The gr...
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