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Jason is considering opening a Fast 'n Clean Car Service Center. He estimates that the following costs will be incurred during his first year of operations: Rent $9,200, Depreciation on equipment $7,000, Wages $16,172, Motor oil $2 per quart. He estimates that each oil change will require 5 quarts of oil. Oil filters will cost $3.00 each. He must also pay The Fast 'n Clean Corporation a franchise fee of $1.10 per oil change since he will operate the business as a franchise. In addition, utility costs are expected vary with the quantity of oil changes as follows: Quantity of Oil Changes 6,300 8,300 11,300 14,300 18,600 Utility Costs $15,184 $18,800 $21,100 $24,100 $26,500 Jason anticipates that he can provide the oil change service with a filter at $42.86 each

Jason is considering opening a Fast 'n Clean Car Service Center. He estimates that the following costs will be incurred during his first year of operations: Rent $9,200, Depreciation on equipment $7,000, Wages $16,172, Motor oil $2 per quart. He estimates that each oil change will require 5 quarts of oil. Oil filters will cost $3.00 each. He must also pay The Fast 'n Clean Corporation a franchise fee of $1.10 per oil change since he will operate the business as a franchise. In addition, utility costs are expected vary with the quantity of oil changes as follows: Quantity of Oil Changes 6,300 8,300 11,300 14,300 18,600 Utility Costs $15,184 $18,800 $21,100 $24,100 $26,500 Jason anticipates that he can provide the oil change service with a filter at $42.86 each

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Need only break even part

Current Attempt in Progress Jason is considering opening a Fast 'n Clean Car Service Center. He estimates that the following costs will be incurred during his first year of operations: Rent $9,200, Depreciation on equipment $7,000, Wages $16,172, Motor oil $2 per quart. He estimates that each oil change will require 5 quarts of oil. Oil filters will cost $3.00 each. He must also pay The Fast 'n Clean Corporation a franchise fee of $1.10 per oil change since he will operate the business as a franchise. In addition, utility costs are expected vary with the quantity of oil changes as follows: Quantity of Oil Changes 6,300 8,300 11,300 14,300 Fixed cost 18,600 Jason anticipates that he can provide the oil change service with a filter at $42.86 each Variable cost $ Using the high-low method, determine variable costs per unit and total fixed costs. (Round variable cost to 2 decimal places, e.g. 52.75.) Utility Costs $ $15,184 $18,800 $21,100 $24,100 $26,500 eTextbook and Media 0.92 per unit 9368
Transcribed Image Text:Current Attempt in Progress Jason is considering opening a Fast 'n Clean Car Service Center. He estimates that the following costs will be incurred during his first year of operations: Rent $9,200, Depreciation on equipment $7,000, Wages $16,172, Motor oil $2 per quart. He estimates that each oil change will require 5 quarts of oil. Oil filters will cost $3.00 each. He must also pay The Fast 'n Clean Corporation a franchise fee of $1.10 per oil change since he will operate the business as a franchise. In addition, utility costs are expected vary with the quantity of oil changes as follows: Quantity of Oil Changes 6,300 8,300 11,300 14,300 Fixed cost 18,600 Jason anticipates that he can provide the oil change service with a filter at $42.86 each Variable cost $ Using the high-low method, determine variable costs per unit and total fixed costs. (Round variable cost to 2 decimal places, e.g. 52.75.) Utility Costs $ $15,184 $18,800 $21,100 $24,100 $26,500 eTextbook and Media 0.92 per unit 9368
Determine the break-even sales quantity of oil changes and sales dollars. (Round Contribution margin ratio to 2 decimal places, e.g. 57.20%. Round final answers to 0 decimal places, e.g. 5720) Break-even oil changes in units Break-even sales in dollars eTextbook and Media
Transcribed Image Text:Determine the break-even sales quantity of oil changes and sales dollars. (Round Contribution margin ratio to 2 decimal places, e.g. 57.20%. Round final answers to 0 decimal places, e.g. 5720) Break-even oil changes in units Break-even sales in dollars eTextbook and Media
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