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Target Profit Calculations

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John Jones is president of Clean Machines, a new car washing service that makes house calls. John has decided that his goal for the coming year is to earn a profit of $40,000. Clean Machines reported the following sales and cost information for the year just ended:

Sales revenue $60,000
Less all variable costs 20,000
Less all fixed costs 40,000
Net income $ 0
Clean Machines performed 500 car washed during the year.

a. How many car washes will Clean Machines need to do in order to earn John's target profit of $40,000?
b. If John thinks that that number of car washes is an unrealistically high goal, what else could he do to achieve his target profit?

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John Jones is president of Clean Machines, a new car washing service that makes house calls. John has decided that his goal for the coming year is to earn a profit of $40,000. Clean Machines reported the following sales and cost information for the year just ended:

Sales revenue ...

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