[SOLVED] Use two pieces of graph paper using the exact same Axis units so that both graphs can be compared to each other.

[SOLVED] Use two pieces of graph paper using the exact same Axis units so that both graphs can be compared to each other.

Use two pieces of graph paper using the exact same Axis units so that both graphs can be compared to each other.
The lines on the graph will be similar but the slope of the total cost line line will be LESS STEEP for the improved case.
Using Chapter 7 problem 7.6 apply C-V-P principles.
P7.6
Two entrepreneurs are contemplating purchasing one of two similar
competitive motels and have asked for your advice. Present sales revenue
of each motel is $550,000 per year.
Where we are NOW:
Jack’s
motel has annual variable costs of 55% of sales revenue and fixed costs of $212,500;
Jock’s
motel has annual variable costs of 60% of sales revenue and fixed costs of $185,000.
This is what the entrepreneurs believe can be accomplished if they buy and operate either property:
Assumption for Jack’s motel:
The entrepreneurs think that, if they purchased Jack’s
motel, they could save $12,000 a year on interest expense (a fixed
cost).
AND
they think that sales revenue can be increased by 25% a year.
Assumption for Jock’s motel:
Alternatively, if they purchased Jock’s motel, they could improve
staff scheduling to the point that the wage saving would reduce
total variable cost to 54%.
AND
they think that sales revenue can be increased by 25% a year.
Calculate:
The present net income of each motel, where we are now.
Then, given these assumptions, calculate where will be.
Advise the entrepreneurs which one they should buy –  IN CLASS, we found
that the Jock Motel property was the better option. As there was much improved upside after they took over.
Give some cautionary comments regarding their assumptions.


Are you overwhelmed by your class schedule and need help completing this assignment? You deserve the best professional and plagiarism-free writing services. Allow us to take the weight off your shoulders by clicking this button.

Get help

Who Will Write your Paper

Writer avatar
Tutor_Charles

Rating: 4.9/5    Reviews 377

Success rate 100%

Completed projects: 545

I am an experienced writer offering professional services across diverse fields. I provide quality work with strict adherence to the deadline.

Writer avatar
Tutor_Dr. Edith

Rating: 4.8/5    Reviews 381

Success rate 100%

Completed projects: 490

I am an experienced writer with great research and analytical skills. Original quality paper and on-time delivery are guaranteed. Let's do this!

Writer avatar
Tutor_Dr.Judy

Rating: 4.7/5    Reviews 316

Success rate 100%

Completed projects: 398

I am a professional writer with more than 8 years of experience. My mission is to provide you with high-quality paper in a timely fashion.

Writer avatar
Tutor_Ian

Rating: 4.8/5    Reviews 371

Success rate 97%

Completed projects: 432

Hi, I deliver quality papers on time following all the instructions provided. Client's satisfaction is my priority. Welcome for plagiarism-free papers.

Writer avatar
Tutor_Prof. Allan

Rating: 4.8/5    Reviews 400

Success rate 100%

Completed projects: 487

With over half a decade of academic experience, I'm committed both to efficiency and punctuality. If it's quality you're looking for, then I'm here to provide!

Writer avatar
Tutor_Prof. Gabie

Rating: 4.9/5    Reviews 447

Success rate 96%

Completed projects: 546

A quality-driven, skilled writer with over 5 years of experience in various disciplines. I deliver plagiarism-free papers and content of impeccable quality, always original and always before the deadline!

Writer avatar
Tutor_Sarah

Rating: 4.9/5    Reviews 427

Success rate 99%

Completed projects: 567

I have been a full-time freelance researcher and writer for a period of over 6 years. I have successfully completed over 1000 projects and assignments. I have had a good professional relationship with my clients. Try me today!

Writer avatar
Tutor_Stella

Rating: 4.9/5    Reviews 305

Success rate 97%

Completed projects: 404

I am a proficient writer with knowledge across a wide range of academic disciplines. I guarantee quality, timely and original content.

Writer avatar
Tutor_SylviaYoung

Rating: /5    Reviews 419

Success rate 96%

Completed projects: 506

Hi, count on me to deliver quality and exemplary papers. I will pay attention to all your instructions, and meet all your expectations.