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Feel Good Massage Offers Customized Sports Massages

Question 144

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Feel Good Massage offers customized sports massages.Feel Good charges $75 for a one-hour massage session that includes a ten-minute session in a therapeutic spa.The spa is leased at a cost of $3,000 per year plus $10 per use.Feel Good pays the massage therapists $20 per session.
Required:
a.What is Feel Good's total annual cost of massages if 60 massages are sold? If 70 are sold? If 80 are sold?
b.What is the company's total cost per massage if 60 massages are sold? If 70 are sold? If 80 are sold?
c.Should Feel Good consider raising the price charged for the sports massage? Why?

Correct Answer:

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a.$3,000 + ($10 + $20) × 60)) = $4,800
$...

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