Sterling Auto Detail is currently open Monday through Friday. In the past year, income before taxes was as follows:

Numbers of cars detailed $2,080$

Revenue

$$468,000$

Less operating expenses:

Supplies $($polish$,$ wax, etc.$)$

$$5,824$

Salaries of detailers

$104,000$

Water and other variable costs

$12,480$

Supervisor$$s salary

$65,000$

Rent

$36,000$

Depreciation

$5,000$

Other fixed costs

$1,050229,354$

Income before taxes

$$238,646$

Quincy Davis, the owner of Sterling, is considering extending the workweek through Saturday. If he takes this action, he$$ll hire a part$-$time employee for $$300$ per day to act as the Saturday manager so the supervisor still can have Saturday off. Quincy estimates that his company will detail an additional $10$ cars per Saturday, $52$ weeks per year. Annual incremental revenue is $$117,000.$ Incremental cost is $$46,176.1)$ Ignoring taxes, what is the incremental profit? $2)$ Should Quincy open his business on Saturday?

Answer rating: 100% (QA)

To determine the incremental profit and whether Quincy should open his business on Saturday we need ... View the full answer