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A service company offers two types of consulting services: Management Consulting and Financial Advisory. The company's fixed costs amount to $200,000 per year. The variable
A service company offers two types of consulting services: Management Consulting and Financial Advisory. The company's fixed costs amount to $200,000 per year. The variable costs per hour for Management Consulting and Financial Advisory services are $50 and $40 respectively. Using Cost-Volume-Profit (CVP) analysis, determine the breakeven point in billable hours for each service. Discuss the implications of breakeven analysis results for service pricing and resource allocation decisions.
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