A local pest control company has purchased equipment costing $150,000 with an estimated lifetime of 7.5 years using straight line depreciation. Additional fixed costs per year are $100,000. Variable costs per pest control service are $40 and the price per unit averages $125. What will annual profit be if the company services 475 customers annually?

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
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Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 10EB: Keleher Industries manufactures pet doors and sells them directly to the consumer via their web...
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General Accounting

A local pest control company has purchased equipment costing
$150,000 with an estimated lifetime of 7.5 years using straight line
depreciation. Additional fixed costs per year are $100,000.
Variable costs per pest control service are $40 and the price per
unit averages $125. What will annual profit be if the company
services 475 customers annually?
Transcribed Image Text:A local pest control company has purchased equipment costing $150,000 with an estimated lifetime of 7.5 years using straight line depreciation. Additional fixed costs per year are $100,000. Variable costs per pest control service are $40 and the price per unit averages $125. What will annual profit be if the company services 475 customers annually?
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