Gulf Shore Lawn and Garden Maintenance provides two general outdoor services: lawn maintenance and garden maintenance. The company charges customers $16 per hour for each type of service, but lawn maintenance has higher variable costs ($7 per hour) than garden maintenance ($5 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, 7,000 hours of lawn maintenance services and 3,000 hours of garden maintenance were provided:

	Lawn maintenance	Per hour	Garden maintenance	Per hour	Total
Sales	112,000	16	48,000	16	160,000
Variable expenses	49,000	7	15,000	5	64,000
Contribution margin	63,000	9	33,000	11	96,000
Fixed expenses					64,800
Operating income					31,200

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 $42,000 if the tax rate is 30%.