The Peace Barber Shop employs four barbers. One barber, who also serves as the manager, is paid a salary of $1,770 per month. The other barbers are paid $1,340 per month. In addition, each barber is paid a commission of $2 per haircut. Other monthly costs are as follows: store rent $780 plus 60 cents per haircut; depreciation on equipment $480; barber supplies 40 cents per haircut; utilities $340; and advertising $240. The price of a haircut is $13.

Determine the variable cost per haircut and the total monthly fixed costs. (Round variable cost to 2 decimal places, e.g. 15.25.)

Variable cost

$

per haircut

Total monthly fixed costs$

Calculate the break-even point in units and dollars.

Break-even Point

unitsBreak-even Point$

Determine the operating income, assuming 1,580 haircuts are given in a month.

Operating income

$