Question
Yoga, Spa, and Swim Club is planning for the coming year. Investors would like to earn a 10% return on the company's $ 40 comma
Yoga, Spa, and Swim Club is planning for the coming year. Investors would like to earn a 10% return on the company's $ 40 comma 000 comma 000 of assets. The company primarily incurs fixed costs to maintain the swimming pool. Fixed costs are projected to be $ 12 comma 900 comma 000 for the year. About 500 comma 000 members are expected to swim each year. Variable costs are about $ 13 per swimmer. The club has a favorable reputation in the area and therefore, has some control over the membership price. Using a cost-plus approach, what price should club charge for a membership? (Round the final answer to the nearest cent.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started