Eppley Quick Trip is an Omaha Company that pciks up customers by appointment and delivers them to Eppley Airport. The Company is currently just barely breaking even - in the most recent year the business made a profit of only $500 for the entire year. The owner does not work in the business - the owner has another good full-time job. The owner is consdiering closing the business. Before making a decision the owner would like a projected budget for a typical month in 3 years. It is anticipated that the Company will have 200 customers a month in 3 years. The expected Fee will be $30 per customer. Variable costs are 25% of Revenue. Fixed monthly expenses paid in cash will be $500. Depreciation is $1,000 per month.
In your post, develop a monthly budget for a single "typical month" 3 years from now; then advise the owner.
First make a brief budget
How much net income will there typically be each month.
How much cash will be available for the owner each month.
Should the owner close the business? Explain your answer