Question
Need help on the following question please! Please be detailed in showing your work on how you got the answers. PDQ Repairs has 200 auto-maintenance
Need help on the following question please! Please be detailed in showing your work on how you got the answers.
PDQ Repairs has 200 auto-maintenance service outlets nationwide. It performs primarily two lines of service: oil changes and brake repair. Oil change-related services represent70% of its sales and provide a contribution margin ratio of20%. Brake repair represents30% of its sales and provides a30% contribution margin ratio. The company's fixed costs are $15,550,000(that is, $77,750per service outlet).
(1)Calculate the dollar amount of each type of service that the company must provide in order to break even.
(2)The company has a desired net income of $54,000per service outlet. What is the dollar amount of each type of service that must be performed by each service outlet to meet its target net income per outlet?
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