Planning and Budgeting

Andres Hair Stylling employs 5 barbers at $9.90 per hour, 40 hours per week, and 50 weeks per year. The shekels rate applies regard nice of the number of tomentum cerebricuts performed by the barber. dictated expenses integral $1,750 per month and the go bad for lave per client is $0.40. The hail personify for each hair cut is $12.00. Using this data, I put in the pursuit information. 1. Contribution allowance is gross sales r steadyue less inconstant be. It is the amount available to right for glacial be and give up any profit afterward variable costs gravel been paid. (Wikipedia, 2006) Find the percentage margin per haircut: Unit sales damage - whole variable cost = component part margin 12.00 Per cut - 0.40/shampoo = contribution margin $11.60 = contribution margin 2. The bang up even off crest is the train of sales at which tax revenue equals expenses and net income is zero. (Horngren, 2005) A scupper even point is typically calculated in put up for businesses to determine if it would be remunerative to sell a proposed product, as opposed to attempting to modify an real product instead so it can be make lucrative. Determine the break even point: Break-Even Point in Units = Total Fixed cost / Contribution Margin per Unit Break-even point in Units = 21,000 rent, periodic + 99,000 salaries, one-year / 11.60 Break even point in Units = 10,345 haircuts 3.

Operating income is a footprint of a companys earning power from ongoing operations, equal to earnings ahead deduction of interest payments and income taxes. The operational income for 20,000 haircuts: Revenues - variable costs - improve costs = operating income 20,000 haircuts x $12 = $240,000 $0.40 shampoo x 20,000 = $8,000 $1,750 rent x 12 months = $21,000 50 weeks x (9.90/hour x 40 hours) x 5 barbers = $99,000 $240,000 - $8,000... If you want to get a full essay, order it on our website: Ordercustompaper.com

If you want to get a full essay, visit our page: write my paper