Question
Wheel Share is a bike sharing company where members buy an annual membership to use their network of bikes. The company is looking to
Wheel Share is a bike sharing company where members buy an annual membership to use their network of bikes. The company is looking to determine what membership price should be charged to meet its target return on investment. The company invested $750,000 in capital. The operating costs are as follows: Variable Operating Cost $17 per membership Fixed Operating Costs Wages and Salaries $415,000 Bike Maintenance $75,000 Other Administrative Expenses $60,000 You are a cost accountant, and management would like to know what should be charged for the annual membership if the company has a target return on investment of 10%, 15% and 20%. It is projected that 4000 memberships will be sold. You are asked to provide a visualization using the cost-plus pricing method. You create a dashboard with the following data visualizations: 1. Total Cost by Cost Component Per Membership - This is a pie chart showing a breakdown of the total cost by cost components per annual membership.
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