Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

10:40 https://v2.cengageno... Break-Even for a Service Firm Jonah Graham owns and operates The Green Thumb Company (GTC), which provides live plants and flower arrangements to

image text in transcribed

10:40 https://v2.cengageno... Break-Even for a Service Firm Jonah Graham owns and operates The Green Thumb Company (GTC), which provides live plants and flower arrangements to professional offices. Jonah has fixed costs of $3,116 per month for office/greenhouse rent, advertising, and a delivery van. Variable costs for the plants, fertilizer, pots, and other supplies average $27 per job. GTC charges $65 per month for the average job. Required: 1. How many jobs must GTC average each month to break even? jobs per month 2. What is the operating income for GTC in a month with 80 Jobs? Enter a net loss as a negative amount. What is the operating income for GTC in a month with 87 jobs? 3. Jonah faces a tax rate equal to 25 percent. How many jobs must Jonah have per month to earn an after-tax income of $1,260 ? Round your answer to the nearest whole number of jobs. jobs per month 4. Suppose that Jonah's fixed costs increase to $3,300 per month and he decides to increase the price to $80 per job. What is the new break-even point in number of jobs per month? Round your answer to the nearest whole number of jobs. jobs per month

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions