your answer. What would you nced to make a about hiring the outside cleaning company on a permanent basis? 2-B2 Cost-Volume-Profit at a Day Care Facility Luke Morrison opened Lnke's Corner, a small day care facility, just over 2 ycars ago. After a rocky start, Luke's Comer has been thriving. Morrison is now preparing a budget for November 20x7 Monthly fixed costs for Luke's Corner are as follows: $ 800 1,400 140 Other fixed costs Total fixed costs The salary is for Anna Dukes, the only employee, who works with Morrison by caring for the children. Morison does not pay himself a salary, but he receives the excess of revenues over costs each month. The cost driver for variable costs is "child-days." One child-day is one day in day care for one child, and the variable cost is S12 per child-day. The facility is open from 6:00 AM to 6:00 PM weckdays (that is, Monday-Friday), and there are 22 weekdays in November 20X7. An average day has 8 children attending Luke's Comer. State law prohibits Luke's Corner from having more than 14 children, a limit it has never reached. Morrison charges $30 per day per child, regardless of how long the child is at the facility 1. What is the break-even point for November in child-days? In revenue dollars? 2. Suppose attendance for November 20X7 is equal to the average, resulting in 22 X 8 - 176 child-days. What amount will Morrison have left after paying all expenses? 3. Suppose both costs and attendance are difficult to predict. Compute the amount have left after paying all expenses for each of the following situations. Consider each case inde- pendently a. Average attendance is 9 children per day instead of 8, generating 198 child-days b. Variable costs increase to $14 per child day c. Rent increases by $220 per month. d. Morrison spends $300 on advertising (a fixed cost) in November. which i daily attendance to 9.5 children. e. Morrison to 7 children. cises in Cost Volurne-Profit Relationships