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7 Gulf Shore Lawn and Garden Maintenance provides two general outdoor services: lawn maintenance and garden maintenance. The company charges customers $30.0 per hour for
7 Gulf Shore Lawn and Garden Maintenance provides two general outdoor services: lawn maintenance and garden maintenance. The company charges customers $30.0 per hour for each type of service, but lawn maintenance has higher variable costs ($18.0 per hour) than garden maintenance ($9.0 per hour) because of fuel expenses incurred to operate lawn-mowing equipment. All employees are paid a fixed monthly salary. A contribution format income statement for a recent month for the two services appears below. During the month, 8,000 hours of lawn maintenance services and 2,000 hours of garden maintenance were provided: Lawn Per Garden Per Maintenance Hour Maintenance Hour Total $30.0 3e0,000 162,000 Sales $240,000 144,000 $30.0 6e,000 Variable expenses 18.0 18,000 9.0 Contribution margin 96,000 $12.0 42,000 $21.0 138,000 Fixed expenses 33,640 99,360 Operating income Required: 1. Compute the overall CM ratio for the company % Overall contribution margin ratio 3. Compute the weighted-average CM per hour for the company. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Lawn Garden Maintenance Care Weighted average CM per hour ook Ask 4. Calculate the overall break-even point for the company in hours Print Total break-even point in hours hours 5. At the overall break-even point in total hours. how many hours of each service must be provided for the company to break-even? Lawn Garden Care Maintenance Number of hours 5. At the overall break-even point in total hours, how many hours of each service must be provided for the company to break-even? Lawn Care Garden Maintenance Number of hours 6. Calculate the overall sales in dollars required to earn an after-tax profit of $67.200 if the tax rate is 30% Sales required to achieve after-tax target profit
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