Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Flounder Service has over 2 0 0 auto - maintenance service outlets nationwide. It provides primarily two lines of service: oil changes ar brake repair.

Flounder Service has over 200 auto-maintenance service outlets nationwide. It provides primarily two lines of service: oil changes ar 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 $12,150,000(or $60,750 pe service outlet).
(a)
Your answer is correct.
Calculate the dollar amount of each type of service that the company must provide in order to break even.
Oil changes
$
Brake repair
$
Attempts: 1 of 2 used
(b)
Your answer is incorrect.
The company has a desired net income of $40,500 per service outlet. What is the dollar amount of each type of service that must be provided by each service outlet to meet its target net income?
Oil changes $
Brake repair $
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored 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

Question

Who should apply a scorecard approach?

Answered: 1 week ago