Terry and Ed start a lawn mowing business and purchase the mowers and equipment for $650. They charge $15 for each lawn and use $2 worth of gas for each job. How many lawns must Terry and Ed mow before breaking even?
To find out how many lawns Terry and Ed must mow before breaking even, we need to calculate their total costs and then divide it by their profit from each lawn.
First, let's calculate the total cost.
The equipment cost is $650.
Next, let's calculate the variable costs per lawn.
They use $2 worth of gas for each lawn.
Now, let's calculate the profit from each lawn.
They charge $15 for each lawn, and their variable cost is $2 for gas, so the profit from each lawn is $15 - $2 = $13.
To determine the number of lawns needed to break even, we need to divide the total cost by the profit from each lawn:
$650 รท $13 = 50.
Therefore, Terry and Ed must mow 50 lawns before breaking even.