1. Dunn Family Auto Repairs offers several services ranging from tire patching t

Question

1. Dunn Family Auto Repairs offers several services ranging from tire patching to complete transmission rebuilding. Since labor is the main cost of these services, the company charges customers a markup on the worker"s wage rate. The most skilled workers earn $25 per hour; Dunn charges customers $40 per hour. If Dunn applies the same markup percentage to each worker, what price will the company charge for a worker who earns $15 per hour? A. $20 B. $24 C. $30 D. $40

2. Montelone Images, A photography studio, sells two photo packages. The standard package has a contribution margin of $5, and the deluxe package has a contribution margin of $12. Montelone sells five standard packages for every one deluxe package. if fixed expenses total $74,000, how many standard and deluxe packages must be sold to break even?

3. The gross margin percentage and the markup percentage are essentially the same. True or False?

4. If a company sells more than one product, it cannot use CVP analysis to examine the effect of changes in costs on operating income, True or false? Support your answer with why it is true or false.

Explanation / Answer

Answer 1. B. $24 Mark Up Percentage = 15 / 25 = 60% Wage Rate 15 Add: Mark Up - 60% 9 Price 24 As per Chegg Guidelines, You can ask only one question at a time having four subparts. For other parts or Questions please ask it again.

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