E19-8 All/That Blooms provides environmentally friendly lawn services for homeowners Its operating costs are as follows. Depreciation Advertising Insurance $1,400 per month $200 per month month $2,000 per lawn $12 per $10 per lawn $2 per lawn Weed and feed materials Direct labor Fuel All That Blooms charges $60 per treatment for the average single-family lawn. Instructions Determine the company's break-even point in (a) number of lawns serviced per month and (b) dollars.
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- Blue Spruce provides environmentally friendly lawn services for homeowners. Its operating costs are as follows. Depreciation $1,400 per month Advertising $200 per month Insurance $8,000 per month Weed and feed materials $13 per lawn Direct labor $25 per lawn Fuel $2 per lawn Blue Spruce charges $80 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 lawns Determine the company's break-even point in dollars. (Round answer to 0 decimal places, e.g. 1,225.) Break-even point $4-1 The Rainier Company provides landscaping services to corporations and businesses. All its landscaping work requires Rainier to use landscaping equipment. Its land- scaping equipment has the capacity to do 10,000 hours of landscaping work. It is currently utilizing 9,000 hours of equipment time. Rainier charges $80 per hour for landscaping work. Cost information for the current activity level is as follows: Revenues ($80 * 9,000 hours) Variable landscaping costs (including materials and labor), which vary with the number of hours worked ($50 per hour * 9,000 hours) Fixed landscaping costs Variable marketing costs (5% of revenues) Fixed marketing costs Total costs Operating income $720,000 450,000 108,000 36,000 72,000 666,000 $ 54,000 Rainier has just received a one-time only special order for landscaping work from Lasell Corporation at $60 per hour that would require 1,000 hours of equipment time. Should Rainier accept the offer even though revenue per hour is less than…Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory and no finished goods inventory; in other words, a cleaning is started and completed on the same day. HHH expects to sell 15,000 cleanings at a price of 45 each next year. Total selling expense is projected at 22,000, and total administrative expense is projected at 53,000. Required: 1. Prepare an income statement in good form. 2. What if Jean and Tom increased the price to 50 per cleaning and no other information was affected? Explain which line items in the income statement would be affected and how.
- Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory; in other words, a cleaning is started and completed on the same day. Required: 1. Prepare a statement of services produced in good form. 2. What if HHH planned to purchase 30,000 of direct materials? Assume there would be no change in beginning and ending inventories of materials. Explain which line items on the statement of services produced would be affected and how (increase or decrease).Jean and Tom Perritz own and manage Happy Home Helpers. Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory and no finished goods inventory; in other words, a cleaning is started and completed on the same day. Required: 1. Prepare a statement of cost of services sold in good form. 2. How does this cost of services sold statement differ from the cost of goods sold statement for a manufacturing firm?Cooperative Society manufactures and sells two types of water filters which are high quality and low quality by using its old equipment. The cost structure of water filters are: High Quality Low Quality Selling price per unit 90,000 25.000 Variable cost per unit 80,000 20,000 The sales mix in units is in the ratio of 3:2 for high quality and low quality respectively. The fixed costs per annum are TZS 945,000,000. Required: (a) (i) Compute breakeven point in units and in shillings for each type of the water filters. show all calculations (ii) Compute the margin of safety in units and in shillings for each type of water filters if a total of 210,000 units are sold annually. show all calculations (b) Basing on the information in (a) above, the Society is considering buying new production equipment. The new equipment will increase the fixed costs by TZS 181,000,000 per annum and will reduce the variable costs by TZS 9,000 and TZS 5,000 for high quality and low quality…
- The Everest Company provides landscaping services to corporations and businesses. All its landscaping work requires Everest to use landscaping equipment. Its landscaping equipment has the capacity to do 12,500 hours of landscaping work. It currently anticipates getting orders that would utilize 11,100 hours of equipment time. Everest charges $110 per hour for landscaping work. Cost information for the current expected activity level is as follows: E (Click the icon to view the cost information.) Required Begin by completing an analysis, and start by showing the computation of the company's contribution margin without the landscaping work from Tilman. Next calculate the contribution margin of the special order. Contribution Margin for Contribution Margin for Cost information Existing Landscape Tilman Corporation Customers Landscaping Work Revenues Revenues ($110 x 11,100 hours) 1,221,000 Variable costs: Variable landscaping costs (including materials and labour), which vary 754,800…Your company makes products XYZ and PQR. The following quality cost-related information is available for each product. For product XYZ: Warranty repair costs Reliability engineering Rework at Greenspan's manufacturing plant Manufaeturing inspeetion Transportation costs to customer sites to fix problems Quality training for employees $120,000 355,000 70,000 40,000 25,000 75,000 For product PQR: Prevention costs 79.4% Appraisal costs Internal failurc costs 3.7% 9.6% External failure costs 7.3% Total quality costs 100.0% 1. Calculate the total amounts of prevention cost, appraisal cost, internal failure cost, and external failure cost for product XYZ. 2. Based on what you found in (1) above, find the percentage of each category of quality cost to the total quality costs for product XYZ 3. Is the company spending its quality costs similarly for XYZ and PQR? Explain your answer.2. Foxx Company manufactures water sealant. This sealant is used to stop leaks in basement orin concrete retainer walls. In 2019 the company sold 1.6M gallons of sealant at price of P3.00per gallon with a variable cost per gallon of P1.50. The fixed costs were P1,550,000In 2020, new automated equipment will be used in production. This will increase fixed costsfor the year to P1,785,000. The variable cost per gallon has been estimated at P1.30 per gallon.The sales volume increased by 15% percent in 2020.Required:1. For 2019 compute the BEP in gallons and pesos.2. For 2020 compute the BEP in gallons and pesos.3. How much is the EBIT for 2019 & 20204.Using the cost and revenue data for 2019 consider each of the following situationsindependently:a. What is the effect on the break even point (in gallons) for the decrease in variable cost fromP1.50 to P1.30?b. What is the effect on the break even point for the increase in fixed costs of P235,000?
- Make or Buy Filtration, Inc. manufactures filters for use in secondary water irrigation systems. The costs per unit, for 20,000 filters, are as follows. Direct materials $6.00 Direct labor 7.00 Variable overhead 1.00 Fixed overhead 2.00 Total costs $16.00 Irrigation Products has offered to sell 20,000 filters to Filtration for $16 per filter. If Filtration accepts Irrigation Products’ offer, the facilities used to manufacture filters could be used to produce refrigerator filtration units. Revenues from the sale of refrigerator filtration units are estimated at $54,000, with variable costs amounting to 50% of sales. In addition, $1 per unit of the fixed overhead associated with the manufacture of secondary water irrigation filters could be eliminated. Compute the following: Cost to make filters Answer Cost to buy filters Answer Should Filtration, Inc. accept Irrigation Product’s offer? Yes, the cost to purchase the filters is less than the cost to…The Lombard Company produces and sells office-space dehumidifiers to companies that own or rent office space. (a) Lombard’s materials and labor costs for producing the dehumidifiers are $3,000 per unit and the fixed costs of its dehumidifier production plant are $1.85 million. If Lombard sells a dehumidifier for $5,000 per unit, what is its percent contribution margin? Show your work. (b) If Lombard used revenue-based compensation to pay its sales force, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (c) If Lombard used the profit-based compensation method described in the course to pay its sales force and sets the dehumidifier’s target price at $5,000 per unit, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (d) Explain the benefit to Lombard’s management of using the profit-based compensation method of Part (c) over revenue-based compensation for…Part P40 is a part used in the production of dehumidifiers at Pollock Corporation. The following costs and data relate to the production of Part P40: Number of parts produced annually Fixed costs Variable costs Total cost to produce 25,000 $44,000 $68,000 $112,000 Pollock Corporation can purchase the part from an outside supplier for $4.55 per unit. If they purchase from the outside supplier, 50% of the fixed costs would be avoided. If the company buys the part, what is the most it can spend per unit so that operating income is equal to $97,000? (Round the final answer to the nearest cent.) A. $3.00 B. $3.88 OC. $2.12 D. $1.55