Calculating income and unit cost for a service company
Total Glass Company repairs chips in car windshields in the company’s home county. Gary White, the owner, incurred the following operating costs for the month of July 2012:
| Salaries and wages | $ 11,000 |
| Windshield repair materials | 4,800 |
| Depreciation on truck | 550 |
| Depreciation on building and equipment | 1,200 |
| Supplies expense | 300 |
| Gasoline and utilities | 2,620 |
Total Glass Company earned $23,000 in revenues for the month of July by repairing 200 windshields. All costs shown are considered to be directly related to the repair service.
Requirements
1. Prepare an income statement for the month of July. Compute the ratio of total operating expense to total revenue and operating income to total revenue.
2. Compute the per unit cost of repairing one windshield.
3. The manager of Total Glass Company must keep unit operating cost below $70 per windshield in order to get his bonus. Did he meet the goal?
4. What kind of system could Total Glass Company use to integrate all its data?
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