In: Accounting
All That Blooms provides environmentally friendly lawn services for homeowners. Its operating costs are as follows.
Depreciation | $1,400 | per month | |
Advertising | $200 | per month | |
Insurance | $2,000 | per month | |
Weed and feed materials | $12 | per lawn | |
Direct labor | $10 | per lawn | |
Fuel | $2 | per lawn |
All That Blooms charges $60 per treatment for the average
single-family lawn.
Determine the company’s break-even point in number of lawns serviced per month.
Break-even point |
enter the break-even point in number of lawns serviced per month |
lawns |
Determine the company’s break-even point in dollars.
Break-even point |
$enter the break-even point in dollars |
Breakeven point = 100 lawns
Breakeven point in dollar = $6000
Working
A | Sale Price per unit | $ 60.00 |
B | Variable Cost per Unit (12+10+2) | $ 24.00 |
C=A - B | Unit Contribution | $ 36.00 |
D | Total Fixed cost (1400+200+2000) | $ 3,600.00 |
E=D/C | Breakeven point in units | 100 |
F= E x A | Breakeven in sales dollars | 6,000.00 |