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Problem 6.40A a-b,d The Peace Barber Shop employs four barbers. One barber, who also serves as the manager, is paid a salaryDetermine the operating income, assuming 1,560 haircuts are given in a month. Operating income SHOW SOLUTION SHOW ANSWER LINK

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Answer #1

Total Variable cost = 2+0.60+0.40 = 3

Total fixed cost = 1770+1300+820+490+360+230 = 4970

.

Breakeven point = Fixed cost/Contribution margin per unit

= 4970/(13-3)

= 497

Breakeven point = 497*13

= 6461

.

Operating income

= (1560*10) - 4970

= 10,630

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