Gulf Shore Lawn And Garden Maintenance Provides Two General Outdoor Services Lawn Maintenance And Garden Maintenance T 1 (36.19 KiB) Viewed 53 times
Gulf Shore Lawn And Garden Maintenance Provides Two General Outdoor Services Lawn Maintenance And Garden Maintenance T 2 (18.64 KiB) Viewed 53 times
Gulf Shore Lawn and Garden Maintenance provides two general outdoor services: lawn maintenance and garden maintenance. The company charges customers $10.0 per hour for each type of service, but lawn maintenance has higher variable costs ($4.0 per hour) than garden maintenance ($2.0 per hour because of fuel expenses incurred to operate lawn mowing equipment. All employees are paid a fixed monthly salary. A contribution format income statement for a recent month for the two services appears below. During the month. 8,000 hours of lawn maintenance services and 2,000 hours of garden maintenance were provided: Sales Variable expenses Contribution margin Fixed expenses Operating income Lawn Maintenance $80,000 32,000 $18,000 Per Hour $10.0 4.0 $ 6.0 Garden Maintenance $20,000 4,000 $16,000 Per Hour $10.0 2. $ 8.0 Total $100,000 36,000 64,000 31,160 $ 32,640 Required: 1. Compute the overall CM ratio for the company. Overal contribution margin ratio %
2. Compute the overall break-even point for the company in sales dollars. Cherub even point 3. Compute the weighted average CM per hour for the company. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Lawn Care Garden Maintenance Weighted average CM per hour
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