Questions -
1) The Old Van Rental Company has 6 vans available for rent late on Wednesday night when the office gets a call from a small group of tourists wishing to rent 3 vans for the next day (one day rental). The daily rate that the rental company charges is $40 per van. However, the group is willing to pay just $30 per van. The company has fixed costs of $ 200,000. What will be the incremental revenue generated if the rental company decides to accept the price offered by the group?
2) The Great View Shop sells an inexpensive, but high-quality, camera for $ 125. The firm has fixed costs of $ 150,000 and the firm's contribution margin amounts to 60% of revenue per unit. How many units much the firm sell to breakeven?
3) Small Industries has fixed costs of $ 100,000 and breakeven sales of $ 800,000. What is the firm's estimated pre-tax profit at $ 1,200,000 sales?
4) Picayune Company estimates that ordering costs are $6.00 per order, picking costs are $4.50 per unique item ordered, packing costs are $0.075 per item, and return costs are $135.00 per return. A customer orders $30,000 worth of goods with direct costs of $24,000. The customer places 200 orders, orders 240 unique items, 1600 items, and makes 22 returns. What is the profit (loss) on this customer?