Cleaning Service Costs Analysis
ChimneySweep provides cleaning services for residential chimneys and fireplaces, with $20 in variable costs for cleaning materials per service call. The fixed costs of labor, the company’s truck, and administrative support total $459,600 per year. With an average of 80 service calls per month, what is the average cost per cleaning service call?
Calculation:
Given data:
- Fixed costs: $459,600
- Variable costs: $19,200 ($20 x 80 x 12)
- Number of calls: 960 (80 x 12)
To find the average cost per cleaning service call:
Average Cost Per Cleaning Service = Total Cost / Number of Calls Taken
Plugging in the values:
Average Cost Per Cleaning Service = ($19,200 + $459,600) / (80 x 12)
Average Cost Per Cleaning Service = $478,800 / 960
Average Cost Per Cleaning Service = $498.75
Therefore, the average cost per cleaning service call for ChimneySweep is $498.75.