Welda's business plan is to provide on-site welding services for local industry, farmers, and loggers. Welda...

 

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Welda's business plan is to provide on-site welding services for local industry, farmers, and loggers. Welda gained experience in the business by working part-time at a small welding shop in Beaver Falls, a town 30 miles south of Andrews, while in technical school. She was able to practice her trade and learn about the market and operations of a business similar to the one she plans to start. She has $2500 in equity, equipment of $6950; welding supplies of $250; permits of $100; material of $900; and welding gas inventory of $165. Prepare her cash flow after you do the break even. Welda estimates that an average welding job will bring in $150 and take 3 hours to complete, including travel time. In her research about operating costs, Welda gathered the data below for her fixed and variable costs: Advertising $100/month Office supplies $25/month Welding gases 15% of sales Insurance $200/month Job materials 25% of sales Owner's draw Telephone Travel Welding supplies Miscellaneous $2,600/month $50/month $175/month $75/month $100/month Use the data above and the "Breakeven" computer template to answer the questions below and help Welda complete a breakeven analysis for her proposed business. If you need more space, use the back of this sheet. 1. Which expenses (listed above) are overhead costs and which are costs of goods sold? 2. What is the monthly breakeven point for Welda's business? How many welding jobs must Welda perform per month to reach this breakeven point? Do your calculations on tab BE 1 in excel shoot. Welda's business plan is to provide on-site welding services for local industry, farmers, and loggers. Welda gained experience in the business by working part-time at a small welding shop in Beaver Falls, a town 30 miles south of Andrews, while in technical school. She was able to practice her trade and learn about the market and operations of a business similar to the one she plans to start. She has $2500 in equity, equipment of $6950; welding supplies of $250; permits of $100; material of $900; and welding gas inventory of $165. Prepare her cash flow after you do the break even. Welda estimates that an average welding job will bring in $150 and take 3 hours to complete, including travel time. In her research about operating costs, Welda gathered the data below for her fixed and variable costs: Advertising $100/month Office supplies $25/month Welding gases 15% of sales Insurance $200/month Job materials 25% of sales Owner's draw Telephone Travel Welding supplies Miscellaneous $2,600/month $50/month $175/month $75/month $100/month Use the data above and the "Breakeven" computer template to answer the questions below and help Welda complete a breakeven analysis for her proposed business. If you need more space, use the back of this sheet. 1. Which expenses (listed above) are overhead costs and which are costs of goods sold? 2. What is the monthly breakeven point for Welda's business? How many welding jobs must Welda perform per month to reach this breakeven point? Do your calculations on tab BE 1 in excel shoot.

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Answer 1 The overhead costs are advertising office supplies telephone insurance travel and miscellan... View the full answer