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Question

Vin Diesel owns the Fredonia Barber Shop. He employs four barbers and pays each a base rate of $1,250 per month.

One of the barbers serves as the manager and receives an extra $500 per month. In addition to the base rate, each barber also receives a commission of $4.50 per haircut.


Other costs are as follows.


Advertising$200 per monthRent$1,100 per monthBarber supplies$0.30 per haircutUtilities$175 per month plus $0.20 per haircutMagazines$25 per month

Vin currently charges $10 per haircut.


(c)


Prepare a CVP graph, assuming a maximum of 1,800 haircuts in a month. Use increments of 300 haircuts on the horizontal axis and $3,000 on the vertical axis.

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