Calculate the breakeven number of additional customers for an entire year, assuming (i) closing time of 4 am and then (ii) your recommended closing time if it differs from 4 am?
Find the safety margin on new customers for the year?
[Hint: For the per-year analysis, remember to account for the cost of the security upgrade. Use straight-line depreciation as a measure of the fixed cost of the security upgrade, and then add the cost of overtime labor for the additional hours of business for each of the 360 business days in the year.]
Given:
Customers per Hour During Experimental Period Over a period of several months, Downtown Barrel tested closing at seven different times - each hour from 10 p.m. to 4 a.m. Each closing time was tested for two weeks. The table below shows the average number of customers during each hour of business, for the nine different closing times. For instance, the first column shows the average number of customers for each hour of business during the period when our closing time was 10p.m. The last column on the right (4 am closing time) was used to find "customers per hour" for the table in Attachment 3. Tami randomly selected 60 customer invoices -30 from day customers, and 30 from evening customers. The purchase revenue and cost data are shown below. (For example, on the first day, the customer made a purchase of $36.14, and the alcohol purchased cost $26.58 to stock.) Attachment 3 Marginal Revenue and Marginal Cost Analysis " The marginal revenue (MR) for the hour is the contribution margin per customer ($11.00) multiplied by the number of customers. Note that if the marginal revenue is calculated in this way, it already takes into account the alcohol cost. 2 The marginal cost (MC) for the hour is the wages for two clerks: $15 per hour before midnight, and $22.50 per hour after midnight. There are 360 days in one business year. Tami randomly selected 60 customer invoices -30 from day customers, and 30 from evening customers. The purchase revenue and cost data are shown below. (For example, on the first day, the customer made a purchase of $36.14, and the alcohol purchased cost $26.58 to stock.) Attachment 3 Marginal Revenue and Marginal Cost Analysis " The marginal revenue (MR) for the hour is the contribution margin per customer ($11.00) multiplied by the number of customers. Note that if the marginal revenue is calculated in this way, it already takes into account the alcohol cost. 2 The marginal cost (MC) for the hour is the wages for two clerks: $15 per hour before midnight, and $22.50 per hour after midnight. There are 360 days in one business year. Customers per Hour During Experimental Period Over a period of several months, Downtown Barrel tested closing at seven different times - each hour from 10 p.m. to 4 a.m. Each closing time was tested for two weeks. The table below shows the average number of customers during each hour of business, for the nine different closing times. For instance, the first column shows the average number of customers for each hour of business during the period when our closing time was 10p.m. The last column on the right (4 am closing time) was used to find "customers per hour" for the table in Attachment 3. Customers per Hour During Experimental Period Over a period of several months, Downtown Barrel tested closing at seven different times - each hour from 10 p.m. to 4 a.m. Each closing time was tested for two weeks. The table below shows the average number of customers during each hour of business, for the nine different closing times. For instance, the first column shows the average number of customers for each hour of business during the period when our closing time was 10p.m. The last column on the right (4 am closing time) was used to find "customers per hour" for the table in Attachment 3. Tami randomly selected 60 customer invoices -30 from day customers, and 30 from evening customers. The purchase revenue and cost data are shown below. (For example, on the first day, the customer made a purchase of $36.14, and the alcohol purchased cost $26.58 to stock.) Attachment 3 Marginal Revenue and Marginal Cost Analysis " The marginal revenue (MR) for the hour is the contribution margin per customer ($11.00) multiplied by the number of customers. Note that if the marginal revenue is calculated in this way, it already takes into account the alcohol cost. 2 The marginal cost (MC) for the hour is the wages for two clerks: $15 per hour before midnight, and $22.50 per hour after midnight. There are 360 days in one business year. Customers per Hour During Experimental Period Over a period of several months, Downtown Barrel tested closing at seven different times - each hour from 10 p.m. to 4 a.m. Each closing time was tested for two weeks. The table below shows the average number of customers during each hour of business, for the nine different closing times. For instance, the first column shows the average number of customers for each hour of business during the period when our closing time was 10p.m. The last column on the right (4 am closing time) was used to find "customers per hour" for the table in Attachment 3. Tami randomly selected 60 customer invoices -30 from day customers, and 30 from evening customers. The purchase revenue and cost data are shown below. (For example, on the first day, the customer made a purchase of $36.14, and the alcohol purchased cost $26.58 to stock.) Attachment 3 Marginal Revenue and Marginal Cost Analysis " The marginal revenue (MR) for the hour is the contribution margin per customer ($11.00) multiplied by the number of customers. Note that if the marginal revenue is calculated in this way, it already takes into account the alcohol cost. 2 The marginal cost (MC) for the hour is the wages for two clerks: $15 per hour before midnight, and $22.50 per hour after midnight. There are 360 days in one business year. Tami randomly selected 60 customer invoices -30 from day customers, and 30 from evening customers. The purchase revenue and cost data are shown below. (For example, on the first day, the customer made a purchase of $36.14, and the alcohol purchased cost $26.58 to stock.) Attachment 3 Marginal Revenue and Marginal Cost Analysis " The marginal revenue (MR) for the hour is the contribution margin per customer ($11.00) multiplied by the number of customers. Note that if the marginal revenue is calculated in this way, it already takes into account the alcohol cost. 2 The marginal cost (MC) for the hour is the wages for two clerks: $15 per hour before midnight, and $22.50 per hour after midnight. There are 360 days in one business year. Customers per Hour During Experimental Period Over a period of several months, Downtown Barrel tested closing at seven different times - each hour from 10 p.m. to 4 a.m. Each closing time was tested for two weeks. The table below shows the average number of customers during each hour of business, for the nine different closing times. For instance, the first column shows the average number of customers for each hour of business during the period when our closing time was 10p.m. The last column on the right (4 am closing time) was used to find "customers per hour" for the table in Attachment 3. Customers per Hour During Experimental Period Over a period of several months, Downtown Barrel tested closing at seven different times - each hour from 10 p.m. to 4 a.m. Each closing time was tested for two weeks. The table below shows the average number of customers during each hour of business, for the nine different closing times. For instance, the first column shows the average number of customers for each hour of business during the period when our closing time was 10p.m. The last column on the right (4 am closing time) was used to find "customers per hour" for the table in Attachment 3. Tami randomly selected 60 customer invoices -30 from day customers, and 30 from evening customers. The purchase revenue and cost data are shown below. (For example, on the first day, the customer made a purchase of $36.14, and the alcohol purchased cost $26.58 to stock.) Attachment 3 Marginal Revenue and Marginal Cost Analysis " The marginal revenue (MR) for the hour is the contribution margin per customer ($11.00) multiplied by the number of customers. Note that if the marginal revenue is calculated in this way, it already takes into account the alcohol cost. 2 The marginal cost (MC) for the hour is the wages for two clerks: $15 per hour before midnight, and $22.50 per hour after midnight. There are 360 days in one business year
