Owning a Small Business 16 Although it was really tough building the playhouse it ended up being something that I enjoyed and the final product made me proud. When I showed the playhouse to one of my friends, he jokingly said "I'd pay you $10,000 to build that in my backyard". That got me thinking about building these playhouses as a possible business. I could come to people's backyard and give them 3 different options for playhouses, and once they choose I could build it right there in their backyard. Consider some of the costs to start and operate this business. List them and provide detail (2 marks) Start-up Costs Operating Costs I don't have a truck or trailer so let's say I take out a loan to buy these. If the loan is for $75,000 borrowed at a rate of 5.2% per annum, compounded monthly for a 4-year term, how much will the loan cost in total? How much interest will I be charged in total? (2 marks) Let's assume that I can sell these playhouses for $10,000 and they cost $3500 in materials to make. There are an additional $624.50 in operating costs per playhouse. If it takes a total of 120 hours to complete 1 playhouse, calculate my hourly rate of pay. (1 mark) What suggestions/tips would you give me to help me start and operate this business successfully? (1 mark)