Hw.30. Debra and Gary are considering offering a doggy day-care service. After some research, they found several pet day-care facilities intheir area, but they were expensive! Further, the facilities were sterile and didn't provide a "homey" or fun environment for pets.Debra and Gary felt they could easily fix these shortcomings.(c)Debra's home would be the location for their business, since it already has a fenced-in yard and is located two blocks from a dog park.Estimated costs for building an outdoor shelter, plus other licensing and business start-up costs, are as follows.Shelter (depreciated over 7 years)Licensing and other annual costsHourly wage for hired labor; planned for only 200 hours per yearVariable costs for foodEstimated volume of dogs per day (open for business 5 days per week, 50weeks per year; average length of stay 8 hours per day)Target cost per dog hourAssume that the company employs a target costing approach and that the going rate for doggy day care is $9 per hour. What is thetarget cost per dog hour if the two friends require a 25% return on their invested assets, which total $616,000 (including Debra'shome)? (Round answer to 2 decimal places, eg. 15.25.)Estimated cost per dog hourTarget cost per dog hour $Show Transcribed Text6.25 per dog hourHow would the target cost and estimated cost per dog hour change if a more accurate estimate of volume is just 9 dogs per day?(Round target cost per dog hour to 2 decimal places, eg. 15.25 and estimated cost per dog hour to 3 decimal places, e.g. 15.256)Selling price $2.125 per dog hour$500per year$800per year$16 per hour$15 per day per dog044 per dog hour/dog hour28 per dayIf the company employs a cost-plus markup of 30%, assuming the original volume of 28 dogs per day, what will be the selling priceper dog hour? (Round answer to 2 decimal places, e.g. 15.25.)

Calculation of Estimated Dog hours per year = 5 x 50 x 8 x 28 = 56000 dog hours

If the company employs a cost-plus markup of 30%, assuming the original volume of 28 dogs per day, what will be the selling price per dog hour? (Round answer to 2 decimal places, e.g. 15.25.) Selling price /dog hour

If the company employs a cost-plus markup of 30%, assuming the original volume of 28 dogs per day, what will be the selling price per dog hour? (Round answer to 2 decimal places, e.g. 15.25.) Selling price /dog hour

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 41P

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