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Gulf Shore Lawn and Garden Maintenance provides two general outdoor services: lawn maintenance and garden maintenance. The company charges customers $18.0 per hour for each

Gulf Shore Lawn and Garden Maintenance provides two general outdoor services: lawn maintenance and garden maintenance. The company charges customers $18.0 per hour for each type of service, but lawn maintenance has higher variable costs ($10.8 per hour) than garden maintenance ($5.4 per hour) because of fuel expenses incurred to operate lawn-mowing equipment. All employees are paid a fixed monthly salary. A contribution format income statement for a recent month for the two services appears below. During the month, 8,000 hours of lawn maintenance services and 2,000 hours of garden maintenance were provided:

Lawn Maintenance Per Hour Garden Maintenance Per Hour Total
Sales $ 144,000 $ 18.0 $ 36,000 $ 18.0 $ 180,000
Variable expenses 86,400 10.8 10,800 5.4 97,200
Contribution margin $ 57,600 $ 7.2 $ 25,200 $ 12.6 82,800
Fixed expenses 23,184
Operating income $ 59,616

Required:

1. Compute the overall CM ratio for the company.

2. Compute the overall break-even point for the company in sales dollars.

3. Compute the weighted-average CM per hour for the company. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

4. Calculate the overall break-even point for the company in hours.

5. At the overall break-even point in total hours, how many hours of each service must be provided for the company to break-even?

6. Calculate the overall sales in dollars required to earn an after-tax profit of $89,600 if the tax rate is 30%.

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