Managerial Accounting

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Unit3 - Individual Projectclose
 
Consider the following scenario:

Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each barber is paid $9.90 per hour and works a 40-hour week and a 50-week year, regardless of the number of haircuts. Rent and other fixed expenses are $1,750 per month. Hair shampoo used on all clients is .40 per client. Assume that the only service performed is the giving of haircuts (including shampoo), the unit price of which is $12. Andre has asked you to find the following information.

1.     Find the contribution margin per haircut. Assume that the barbers' compensation is a fixed cost. Show calculations to support your answer.

2.     Determine the annual break-even point, in number of haircuts. Support your answer with an appropriate explanation. Show calculations to support your answer.

3.     What will be the operating income if 20,000 haircuts are performed? Show calculations to support your answer.

4.     Suppose Andre revises the compensation method. The barbers will receive $4 per hour plus $6 for each haircut. What is the new contribution margin per haircut? What is the annual break-even point (in number of haircuts)? Show calculations to support your answer.

Grading Criteria

Percentage

Find the contribution margin per haircut.

25%

Determine the annual break-even point, in number of haircuts.

25%

What will be the operating income if 20,000 haircuts are performed?

25%

Suppose Andre revises the compensation method. The barbers will receive $4 per hour plus $6 for each haircut. What is the new contribution margin per haircut? What is the annual break-even point (in number of haircuts)?

25%

 

    • Posted: 5 years ago
    • Due: 
    • Budget: $15
    Answers 7
    • Managerial Accounting
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    • Katetutor....

      Excel spreadsheet and 1-2 pages

      Assignment Objectives

      Understand the role of performance measures in an organization

      Consider the following scenario:

      Andre has asked you …

    • Rated 2 times

      need help

      Consider the following scenario:

      Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each barber is paid $9.90 per …

    • Rated 2 times

      help accounting

      Need 1-2 pages, and an excel spreadsheet for this

      Consider the following scenario:

      Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. …

    • Rated 2 times

      Accounting

      Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each barber is paid $9.90 per hour and works a 40-hour week and …

    • Consider the following scenario:


      Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each barber is paid $9.90 per …

    • Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each barber is paid $9.90 per hour and works a 40-hour week and …

    • Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each barber is paid $9.90 per hour and works a 40-hour week and …

    • Unit3 - Individual Project Consider the following scenario: Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) …

    • Rated 2 times

      managerial account

      Excel spreadsheet 2 pages

      Consider the following scenario:

      Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each …

    • Andre has asked you to evaluate his business, Andre’s Hair Styling. Andre has five barbers working for him. (Andre is not one of them.) Each barber is paid $9.90 per hour and works a 40-hour week and …