Discuss the company experience if the center is closed

Assignment Help Finance Basics

Reference no: EM1352388

It's close to a $40,000 loser and we ought to devote our efforts elsewhere", noted Kara Whitmore, after reviewing financial reports of her company's attempt to offer a reduced-price daycare service to employees. The daycare's financial figures for the year just ended follow.

Revenues $120,000
Fixed Costs $45,000
Traceable Fixed Costs $89,000
Allocated Corporate Overhead $24,000

If the daycare service/center is closed, 70% of the traceable fixed cost will be avoided. In addition, the company will incur one-time closure costs of $6,800.

Required:

A. Show calculations that support Kara Whitmore's belief that the daycare center lost almost $40,000.
B. Should the center be closed? Show calculations to support your answer.
C. What problem might the company experience if the center is closed?

Reference no: EM1352388

Questions Cloud

Show indifference curve that goes through that bundle : for each bundle that the consumer chooses, show the indifference curve that goes through that bundle. Make sure to label your graph carefully and accurately.

Understanding organizational behavior : What is organizational behavior and why is it important to analyze and understand organizational behavior?

Describe findings after conducting internet search for cde : The network administrator mentions that other ".cde" files have been sent through an FTP server to another site. Describe your findings after conducting an Internet search for ".cde" files.

Calculate the total energy stored in the two capacitors : A pendulum clock that works perfectly on Earth is taken to the Moon. (a) Does it run fast or slow there? (b) If the clock is started at 12:00 midnight, what will it read after one Earth day (24.0 h)? suppose that the free-fall acceleration on the ..

Discuss the company experience if the center is closed : It's close to a $40,000 loser and we ought to devote our efforts elsewhere, noted Kara Whitmore, after reviewing financial reports of her corporation's attempt to offer a decreased-price daycare service to employees.

What would be the growth rate of agriultural production : Suppose population growth rate is 0.03, inome elastiity of demand for consumption is 0.75 and inome growth rate of 0.05. what would be the growth rate of agriultural production for balaned growth of the economy.

Explain high performance organizations : How can increased performance be initiated and what are the benefits of increased performance to an organization?

Define what a manger should do in each of the michigan case : Define what a manger should do in each of the Michigan cases and What circumstances might lead you to make different decisions in different cases under Megan's law?

Description of psychology : So, what are some of the ways to make sure we make a thoughtful decision regarding our clients?

User Account

All Pages