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Construction on the Bonita Full-Service Car Wash is nearing completion. The owner is Dave Kaar, a ratired accounting professor. The car wash is stratexically located

image text in transcribed Construction on the Bonita Full-Service Car Wash is nearing completion. The owner is Dave Kaar, a ratired accounting professor. The car wash is stratexically located on a busy strest that separates an affluent suburban community from a middle-class community. It has two state-of-the-art stalls. Each stall ean provide anything from a basic two-stage wesh and rinse to a five-stage luxurious bath. It is all "touchless," that is, there are no brushes to potentially damage the car. Outside each stall, there is also a 400 horse-power vacuum. Dave likes to joike that these vacuums are so strong that they will pull the carpet right out of your car if you aren't careful. Dave has some important decisions to make before he can open the car wash. First, he lonows that there is one drive-through car wash only a 10-minute drive away. It is attachad to a zas station; it charzes $4.80 for a basicwash, and $3.90 if you also buy at least 8 gallons of gas. It is a"brush"-type wash with rotating brush heads. There is a lso a self-serve"stand outside your car and spray until you are soaloed" car wash a 15 -minute drive away from Dave's location. Hewent ovar and tried this out. Hewant through $3.00 in quarters to get the equivalent of a basic wash. He lonows that both of these locations always havelong lines, which is one resson why he decided to build a naw car wash. Dave is planning to offer thres levels of wash servica-Basic, Deluxe, and Pramium. The Basic is all automated; it requires no diract intervention by employes. The Deluxe is all automated except that at the end an employes will wipe down the car and will put a window treatment on the windshizld that reduces glare and allows rainwater to run off more quickly. The Pramium level is a "pampered" service. This will include all the services of the Deluxe, plus a special wax after the machine wax, and an employes will vacuum the car, wipe down the entire interior, and wash the inside of the windows. To provide the Premium service, Dave will have to hire a couple of "car wash specialists" to do the additional pampering. Dave has pullad together the following estimates, based on data he received from the local Chamber of Commerce and information from a trade association. The tatal estimated number of washes of any type is 42,000 . Dave has imested assets of $392,700. He would like a return on investment (ROI) of 20%. Anower each of the following questions. (b) Dave estimates that of the total 42,000 washes, 19,000 will be Basic, 19,000 will be Deluxa, and 4,000 will be Pramium. Calculate the salling price, using cost-plus pricing that Dave should use for each type of wash to achizve his desired ROl of 20\%. (Round answers to 2 decimal places, e.s. 52.75.)

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