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Blossom Auto has 270 automaintenance service outlets nationwide. It provides two main lines of service: oil changes and brake repair. Oil changes and related services
Blossom Auto has 270 automaintenance service outlets nationwide. It provides two main lines of service: oil changes and brake repair. Oil changes and related services represent 70% of its sales and provide a contribution margin ratio of 20%. Brake repair represents 30% of its sales and provides a 60% contribution margin ratio. The company's xed costs are $21,600,000 (that is, $80,000 per service outlet}. Calculate the dollar amount of each type of service that the company must provide in order to break even. Oil changes 55 Brake repairs $ The company has a desired operating income of $74,400 per service outlet. Calculate the dollar amount of each type ofservice that must be provided by each service outlet to meet the company's target operating income per outlet. Oil changes $ l Brake repairs $ l
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