After taking business classes, Jake, an avid dog-lover, decided to start selling unique pet supplies at trade shows. He has two products: Product 1: "Launch-it"- a tennis ball thrower that will sell for $11. Product 2: "Treat-time"- an automatic treat dispenser that releases a treat when the dog places his paw on the pedal. The treat dispenser will sell for $33. Costs: Jake has hired an employee to work the trade show booths. The work contract is $1,000 per month plus a commission equal to 12% of sales revenue. Jake will also spend $450 per month on trade-show entry fees. Jake is purchasing the products from a supplier in Mexico. Launch-its cost $2 each; Treat-times cost $7.5 each. Shipping and handling on the Launch-its will cost $2 each; Shipping and handling on the Treat-times, which are heavier, will cost $7 each. The shipping and handling costs will be paid by Jake, not the customer. Assume Jake expects to sell 220 Launch-its and 130 Treat-times during his first month of operations (June). Jake's financial goal is to earn an operating income of $7,775 per month. He believes volume may grow at a rate of 5% a month. What are my fixed expenses, variable expenses, and operating income?
After taking business classes, Jake, an avid dog-lover, decided to start selling unique pet supplies at trade shows. He has two products:
Product 1: "Launch-it"- a tennis ball thrower that will sell for $11.
Product 2: "Treat-time"- an automatic treat dispenser that releases a treat when the dog places his paw on the pedal. The treat dispenser will sell for $33.
Costs: Jake has hired an employee to work the trade show booths. The work contract is $1,000 per month plus a commission equal to 12% of sales revenue. Jake will also spend $450 per month on trade-show entry fees. Jake is purchasing the products from a supplier in Mexico. Launch-its cost $2 each; Treat-times cost $7.5 each. Shipping and handling on the Launch-its will cost $2 each; Shipping and handling on the Treat-times, which are heavier, will cost $7 each. The shipping and handling costs will be paid by Jake, not the customer.
Assume Jake expects to sell 220 Launch-its and 130 Treat-times during his first month of operations (June).
Jake's financial goal is to earn an operating income of $7,775 per month. He believes volume may grow at a rate of 5% a month.
What are my fixed expenses, variable expenses, and operating income?
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