Question
Jonah Graham owns and operates The Green Thumb Company (GTC), which provides live plants and flower arrangements to professional offices. Jonah has fixed costs of
Jonah Graham owns and operates The Green Thumb Company (GTC), which provides live plants and flower arrangements to professional offices. Jonah has fixed costs of $4,300 per month for office/greenhouse rent, advertising, and a delivery van. Variable costs for the plants, fertilizer, pots, and other supplies average $20 per job. GTC charges $63 per month for the average job.
Required:
1. How many jobs must GTC average each month to break even? ___________jobs per month
2. What is the operating income for GTC in a month with 97 jobs? Enter a net loss as a negative amount.
What is the operating income for GTC in a month with 105 jobs?
3. Jonah faces a tax rate equal to 25 percent. How many jobs must Jonah have per month to earn an after-tax income of $1,260? Round your answer to the nearest whole number of jobs. __________4 jobs per month
4. Suppose that Jonahs fixed costs increase to $4,424 per month and he decides to increase the price to $79 per job. What is the new break-even point in number of jobs per month? Round your answer to the nearest whole number of jobs. _________5 jobs per month
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