Stanley Clipper,now Retired,owns the Campus Barber Shop

Essay

Stanley Clipper,now retired,owns the Campus Barber Shop.He employs five (5)barbers and pays each a base rate of $500 per month.One of the barbers serves as the manager and receives an extra $300 per month.In addition to the base rate,each barber also receives a commission of $3 per haircut.A barber can do as many as 20 haircuts a day,but the average is 14 haircuts per day.The Campus Barber Shop is open 24 days a month.You can safely ignore income taxes.
Other costs are incurred as follows:
Stanley currently charges $8 per haircut.
Required:
(a)Compute the break-even point in (1)number of haircuts,(2)total sales dollars,and (3)as a percentage of capacity.
(b)In March,1,400 haircuts were given.Compute the operating profits for the month.
(c)Stanley wants a $2,160 operating profit in April.Compute the number of haircuts that must be given in order to achieve this goal.
(d)If 1,500 haircuts are given in April,compute the selling price that would have to be charged in order to have $2,160 in operating profits.