You plan on starting a lawn mowing business by investing $700 of your own money and purchase $500 of equipment. You plan to work 260 hours per month and charge your customers $23 per hour. Your anticipated costs include: $25.00 per month $26.00 per month $1.40 per hour $9.00 per hour $40.00 per month Calculate your Variable cost per hour on the budgeted contribution margin income statement. Depreciation Advertising Gas Assistant's Wages Miscellaneous Expenses

You plan on starting a lawn mowing business by investing $700 of your own money and purchase $500 of equipment. You plan to work 260 hours per month and charge your customers $23 per hour. Your anticipated costs include: $25.00 per month $26.00 per month $1.40 per hour $9.00 per hour $40.00 per month Calculate your Variable cost per hour on the budgeted contribution margin income statement. Depreciation Advertising Gas Assistant's Wages Miscellaneous Expenses

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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You have a business selling and delivering pizzas to businesses for lunch. You pay $4,000 per month in rent, $320 for utilities, and $2,000 a month for salaries. You also have delivery cars that cost $1,000 per month. Your variable costs are $8 per pizza for ingredients and $4 per pizza for delivery costs. You sell the pizzas for $20 each. Round up if necessary What is the number of pizzas you need to sell to break even for the month If you want to make a profit of 2,000 per month, how many pizzas do you need to sell? Round up if necessary Go back to the original numbers If the price of cheese goes up and your variable costs go by $3 what is your new break even in pizzas if you increase your price to $21 Round up if necessary Golden Company has a fleet of delivery trucks and has the following Overhead costs per month with the miles driven Miles Driven Total Costs March 50.000 194.000 Aprill 40.000 170.200 this is the low May 60.000 217.600 June 70.000 241.000 Use the High-Low method to…
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Suppose you are the human resource manager for a cellular phone company with 700 employees. Top management has asked you to implement three additional fringe benefits that were negotiated with employee representatives and agreed upon by a majority of the employees. These include group term life insurance, a group legal services plan, and a wellness center. The life insurance is estimated to cost $390 per employee per quarter. The legal plan will cost $312 semiannually per employee. The company will contribute 40% to the life insurance premium and 75% to the cost of the legal services plan. The employees will pay the balance through payroll deductions from their biweekly paychecks. In addition, they will be charged 1 4 % of their gross earnings per paycheck for maintaining the wellness center. The company will pay the initial cost of $800,000 to build the center. This expense will be spread over 5 years. (a) What total amount should be deducted per paycheck for these new…
Problem 9) An entrepreneur is considering opening a coffee shop in downtown Pasadena. The building that he is considering will have a monthly lease payment of $3200 and basic utility costs of $600-per month. Two employees will be hired at $10.00/hour/employee (including overhead and benefits). Each employee will work an average of 170 hours per month. The average revenue per customer is estimated at $7.00. The variable cost of serving each customer is estimated at $2.00. (a) Calculate how many customers per month it will take for the coffee shop owner to breakeven. (b) How many customers would need to be served per month to achieve a monthly profit of $5,000?
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