Doggy Day Care is a proposed new business venture that will look after pet dogs for their owners during the day while the dogs’ owners are at work. The following costs have been identified by the business owner:

Required:
a Calculate the annual fixed costs of the proposed business.
b Calculate the variable expenses per dog.
c Calculate the contribution margin per dog.
d Calculate how many dogs would need to be cared for each year for the business to break-even.
e Calculate the annual profit or loss of the business with the expected number of dogs in care currently expected.

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Annual registration of the business with the local council Annual lease costs for the new premises Utilities costs per month Daily food costs per dog Monthly salary for staff Other sundry daily expenses per dog Monthly cleaning expenses for the business Proposed daily fee charged per dog per day Number of days expected to be open per year Expected number of dogs cared for per day $ 240 $3 000 $ 30 30 69 $ 2 $ 560 $ 3 $ 200 $ 15 245 10 10