Carol is starting a virtual craft workshop business. Currently she is planning to have 3 different workshops to offer. Carol's Crafts plans to call each workshop a "party". She has already experimented with Party A where she charges $45 per guest. Carol's has been hosting 40 guests per week. Her variable costs for Party A are $600 per week. Carol has fixed costs of $7, 000 and knows that her fixed costs will not increase if she can host more "parties" each week. Carol plans to add Party B and Party C to her weekly workshop schedule. Party B will feature a smaller kid's craft with a Workshop fee of $25 per guest and variable costs of $15. Party C will be a weekly craft club with a club fee of $60 guest and variable costs of $20. Carol plans a party mix with a ratio of 1 Party B for every 2 Party Cand 7 Party A for every Party B. (7:1:2). Carol plans to host 250 guests each week at parties. Based on this information please help Carol predict her potential net income to see if she can make this her new full-time income.

Carol is starting a virtual craft workshop business. Currently she is planning to have 3 different workshops to offer. Carol's Crafts plans to call each workshop a "party". She has already experimented with Party A where she charges $45 per guest. Carol's has been hosting 40 guests per week. Her variable costs for Party A are $600 per week. Carol has fixed costs of $7, 000 and knows that her fixed costs will not increase if she can host more "parties" each week. Carol plans to add Party B and Party C to her weekly workshop schedule. Party B will feature a smaller kid's craft with a Workshop fee of $25 per guest and variable costs of $15. Party C will be a weekly craft club with a club fee of $60 guest and variable costs of $20. Carol plans a party mix with a ratio of 1 Party B for every 2 Party Cand 7 Party A for every Party B. (7:1:2). Carol plans to host 250 guests each week at parties. Based on this information please help Carol predict her potential net income to see if she can make this her new full-time income.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 6PB: Karens Quilts is considering the purchase of a new Long-arm Quilt Machine that will cost $17,500 and...

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