Joe's new cigar shop is selling cigars for $2.50 after buying them wholesale for $13.00 a dozen. Joe expects to sell 750 cigars a week. If Joe is to make a 10% profit, how much can he afford to spend on fixed expenses (remodeling his store, humidor's, etc)?
2006-10-25 11:47:37 · 3 answers · asked by lostinmath 1 in Science & Mathematics ➔ Mathematics
750 cigars/12 = 62.5 dozen x $13.00 = $812.5 (raw material cost)
750 cigars x $2.50 each = $1,875 (income)
Profit = $1,875 -$812.50 = $1,062.50
Now Joe wants to keep 10% of the profit which is
$1,062.50 x 0.10 = $106.25
This leaves him with $1062.50 - 106.25 = $956.25 to cover his fixed expenses.
2006-10-25 12:10:08 · answer #1 · answered by Suedoenimm 3 · 0⤊ 0⤋
he is going to sell 62.5 dozen at 2.50 ea that is a gross profit of $1,875.00
his cost for cigars is $812.50
the net profit is $1062.50
10% of that is $106.25
what's left is $956.25/week
If I were Joe, I would take more profit if I wanted to eat and pay the mortgage.
2006-10-25 11:54:37 · answer #2 · answered by SteveA8 6 · 0⤊ 0⤋
This isn't statistics or probability.
2006-10-25 12:41:59 · answer #3 · answered by MathGuy 3 · 0⤊ 0⤋