Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen

تمرين 20

BREAK-EVEN FOR A SERVICE FIRM
Sasha Melton owns and operates The Green Belt Company (GBC), which provides live plants and flower arrangements to professional offices. Sasha has fixed costs of $2,380 per month for office/greenhouse rent, advertising, and a delivery van. Variable costs for the plants, fertilizer, pots, and other supplies average $25 per job. GBC charges $60 per month for the average job.
Required:
1. How many jobs must GBC average each month to break even?
2. What is the operating income for GBC in a month with 65 jobs? With 90 jobs?
3. Sasha faces a tax rate equal to 30 percent. How many jobs must Sasha have per month to earn an after-tax income of $980? (Round your answer up to whole units.)
4. Suppose that Sasha's fixed costs increase to $2,500 per month and she decides to increase the price to $75 per job. What is the new break-even point in number of jobs per month? (Round any fractional answer up to the next whole number of jobs.)