Given the followeng information, perform a simple, annual break even analyis State the formula, determine the annual ales feque and the number of total customers required if the break-evern point was to be reached at the end of the first year. Show all your calculations Expenses and Costs Rent is $2,000/month Professional fees are 52.000/yr. Equipment is $11,000/yr. which has a depreciation of 20yr Insurance is $1,000/yr. Wages are $18,000/yr. plus a 5% sales commission Start-up inventory is $4,000. Cost of Goods is 35% of sales. Average purchase amount per paying customer is $100. One out of every two potential custormers who enter the store wll be a paying customer. What is the break-even sales figure? How many potential customers will the business require to break-even?
Given the followeng information, perform a simple, annual break even analyis State the formula, determine the annual ales feque and the number of total customers required if the break-evern point was to be reached at the end of the first year. Show all your calculations Expenses and Costs Rent is $2,000/month Professional fees are 52.000/yr. Equipment is $11,000/yr. which has a depreciation of 20yr Insurance is $1,000/yr. Wages are $18,000/yr. plus a 5% sales commission Start-up inventory is $4,000. Cost of Goods is 35% of sales. Average purchase amount per paying customer is $100. One out of every two potential custormers who enter the store wll be a paying customer. What is the break-even sales figure? How many potential customers will the business require to break-even?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Given the following information, perform a simple, annual break-even analysis. State the formula, determine the arinual sales required
and the number of total customers required if the break-even point was to be reached at the end of the first year. Show all your
calculations
Expenses and Costs
Rent is $2,000/month.
Professional fees are $2.000/yr.
Equipment is $11.000/yr. which has a depreciation of 20%/yr.
Insurance is $1,000/yr.
Wages are $18.000/yr. plus a 5% sales commission
Start-up inventory is $4,000,
Cost of Goods is 35% of saies
Average purchase amount per paying customer is $100. One out of every two potential customers who enter the store will be a paying
customer.
What is the break-even sales figure?
How many potential customers will the business require to break-even?
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