a nail salon pays $2500 in rent per month and each nail technicians get paid $20 per client visit. supplies…

a nail salon pays $2500 in rent per month and each nail technicians get paid $20 per client visit. supplies cost $500 per month. at 150 client visits per month, how much does the salon have to mark up each visit, percentage - wise, for to break even at the end of the month. 25% 200% 100% 50%

a nail salon pays $2500 in rent per month and each nail technicians get paid $20 per client visit. supplies cost $500 per month. at 150 client visits per month, how much does the salon have to mark up each visit, percentage - wise, for to break even at the end of the month. 25% 200% 100% 50%

Answer

Explanation:

Step1: Calculate total fixed - costs

The rent is $2500 and supplies cost $500 per month. So the total fixed - costs $C_f=2500 + 500=3000$.

Step2: Calculate current variable costs

Each technician is paid $20 per client visit and there are 150 client visits. So the variable cost $C_v=20\times150 = 3000$.

Step3: Calculate total costs

The total cost $C = C_f+C_v=3000 + 3000=6000$.

Step4: Calculate current revenue without markup

The current revenue without markup $R_1=20\times150 = 3000$.

Step5: Calculate the required revenue to break - even

To break - even, the revenue $R_2$ should be equal to the total cost $C$, so $R_2 = 6000$.

Step6: Calculate the markup per visit

Let the new price per visit be $p$. We know $R_2=p\times150$, so $p=\frac{6000}{150}=40$. The original price per visit is $20$.

Step7: Calculate the percentage markup

The percentage markup formula is $\text{Markup}%=\frac{p - 20}{20}\times100%$. Substituting $p = 40$ into the formula, we get $\text{Markup}%=\frac{40 - 20}{20}\times100%=100%$.

Answer:

100%