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    Accounting: Breaking Even

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    1. Group your fixed and variable costs
    2. Calculate your break-even point in monthly sales
    3. Determine your monthly sales needed to have a contribution margin of $10,000
    4. Determine your net income/profit when you have a contribution margin of $10,000
    5. Determine your margin of safety based on your monthly sales over the break-even sales.

    Your new food service operation has the following expenses:

    Salary $ 3,000.00 per month

    Utilities $ 375.00 per month

    Contract Services $ 575.00 per month

    Advertising $ 190.00 per month

    Rent $1,000.00 per month

    Insurance $ 100.00 per month

    Accounting and Legal fees $ 175.00 per month

    Permits and Licenses $ 75.00 per month

    Operating Supplies 10% of monthly sales

    Hourly Wages 30% of monthly sales

    Food Cost 25% of monthly sales

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    https://brainmass.com/business/interest-rates/accounting-breakeven-596062

    Solution Preview

    Application of Financial Concepts I: Show and explain your work. Save as an Excel file
    Your new food service operation has the following expenses:
    Element Amount/Month
    Salary $3,000
    Utilities $375
    Contract services $575
    Advertising $190
    Rent $1,000
    Insurance $100
    Accounting and legal fees $175
    Permits and licenses $75
    Operating supplies 10% of monthly sales
    Hourly wages 30% of monthly sales
    Food cost 25% of monthly sales

    1. Group your fixed and variable ...

    Solution Summary

    The problem set deals with questions under accounting: break-even estimation.

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