Chapter 22  Understanding Profit

Class Discussion Questions

1) Class discussion questions

Darin Jones and Linda Smith have decided to increase the prices. Depreciation and rent are still $100,000. 
Variable costs such as labor were expected to be $2.00 per vehicle washed. Price was expected to average 
$8.00 per vehicle, and they plan to wash 30,000 cars per year. 1. Calculate the expected second-year profit 
for Speedy Car Wash.







2. Graph the data in Question #1 using a scale in thousands.







3. Calculate the break-even point for the data in Question #1 using the concept of contribution to margin.









4. Redo Question #3 taking an algebraic approach.






Answers to Chapter 22 Class Discussion Questions Table of Contents
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