Pup N\' Suds MILESTONE 1 - Variable and Fixed Cost Exercise INSTRUCTIONS: Determ

Question

Pup N' Suds MILESTONE 1 - Variable and Fixed Cost Exercise INSTRUCTIONS: Determine the per-unit cost for each dog. Fill in the blanks to get the per-unit cost and fixed cost of each service. Most costs are provided for you. Only fill in the missing costs. Based on 5 grooms per day GROOMING Item Variable Costs Item Fixed Costs Shampoo $1.04 Groomer $2,080.01 Clipper(s) 1.37 Rent 30.95 Bowls 0.72 Loan 20.00 Towels 5.83 Utilities and Insurance 28.57 Scissors 1.01 Depreciation on heating system 3.95 Cleaning Products: Odoban 2.08 Cleaning Products: Simple Green 2.36 Draw 200.00 Total Variable Costs $9.97 Total Fixed Costs $2,367.92 Based on 22 dogs per day, 25 operating days for day care, and 22 eight-hour work days for day care attendant. DAY CARE Item Variable Costs Item Fixed Costs Day care attendant $2.88 Rent $232.14 Toys 0.27 Loan 150.00 Bowls 0.19 Utilities and Insurance 357.16 Towels 1.40 Depreciation on heating system 29.64 Cleaning Products: Odoban 15.59 Cleaning Products: Simple Green 16.78 Draw 200.00 Total Variable Costs $4.74 Total Fixed Costs $858.44 Based on 12 dogs per day, 30 operating days for boarding, and 22 eight-hour work days for kennel attendant. BOARDING Item Variable Costs Item Fixed Costs Kennel attendant $5.63 Depreciation on kennels $80.00 Bowls 0.86 Rent 386.90 Towels 0.87 Loan 250.00 Utilities and Insurance 357.16 Depreciation on heating system 49.40 Cleaning Products: Odoban 25.98 Cleaning Products: Simple Green 29.55 Draw 200.00 Total Variable Costs $7.35 Total Fixed Costs $1,378.99

Explanation / Answer

Day Care Boarding Grooming Sales Price $ 20 $ 28 $ 30 Variable Cost per Unit 4.74 7.35 9.97 Contribution Margin $ 15.26 $ 20.65 $ 20.03 Contribution Margin Ratio 76.30 % 73.75 % 66.77 %

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