Kaplan WIley Plus
Anthony Herrera recently fulfilled his long-time dream of opening a gym that offers spinning exercise classes for $5.85 per person. To differentiate his gym and better serve his clients, Anthony provides a towel, a bottle of water, and an after-workout protein shake to each person participating in a class, at a cost of $2.08 per person. Anthony employs three part-time instructors and pays them each $1,128 per month. He also pays himself a monthly salary of $4,424. Anthony’s other monthly costs are $1,510 for rent, $1,418 for depreciation on his 32 bikes, and $1,990in utilities and insurance. Required
a. What is Anthony’s contribution margin per unit?
b. What is Anthony’s contribution margin ratio?
c. Prepare Anthony’s monthly contribution format income statement assuming he teaches 5,351 clients.