Sharon's Cutting Station offers a new concept in haircuts; low cost and very quick. Set in a local mall, Sharon's offers 15-minute haircuts for harried shoppers who do not have time for lengthy appointments. To ensure that the clients are in and out quickly, she schedules her 5 employees based on expected client traffic. Each of the employees is paid $1220 per month, with part of their pay coming from client tips. Sharon pays rent and overhead costs of $2400 per month on the facility. Because of the quick nature of the service, Sharon doesn't have time to clean combs in between clients, so she uses a new comb for each customer, at a cost of $0.60 each. She also provides shampoo and conditioner for each client at a cost of $1.05 per client. The average price for a haircut is $15. Sharon pays herself $5600 per month. What is Sharon's contribution margin ratio? 89.0% O 85.8% O 12.0% O 11.0%

Sharon's Cutting Station offers a new concept in haircuts; low cost and very quick. Set in a local mall, Sharon's offers 15-minute haircuts for harried shoppers who do not have time for lengthy appointments. To ensure that the clients are in and out quickly, she schedules her 5 employees based on expected client traffic. Each of the employees is paid $1220 per month, with part of their pay coming from client tips. Sharon pays rent and overhead costs of $2400 per month on the facility. Because of the quick nature of the service, Sharon doesn't have time to clean combs in between clients, so she uses a new comb for each customer, at a cost of $0.60 each. She also provides shampoo and conditioner for each client at a cost of $1.05 per client. The average price for a haircut is $15. Sharon pays herself $5600 per month. What is Sharon's contribution margin ratio? 89.0% O 85.8% O 12.0% O 11.0%

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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