Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

b. The company has a desired net income of $50,000 per service outlet. What is the dollar amount of each type of service that must

image text in transcribedb. The company has a desired net income of $50,000 per service outlet. What is the dollar amount of each type of service that must be performed by each service outlet to meet its target net income per outlet?

Concord Service has over 200 auto-maintenance service outlets nationwide. It provides primarily two lines of service: oil changes and brake repair. Oil change-related services represent 80% of its sales and provide a contribution margin ratio of 15%. Brake repair represents 20% of its sales and provides a 65% contribution margin ratio. The company's fixed costs are $12,510,000 (or $62,550 per service outlet). (a) Calculate the dollar amount of each type of service that the company must provide in order to break even. Oil changes $ Brake repair (b) The parts of this question must be completed in order. This part will be available when you complete the part above

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