Candy has opened a mechanic's garage in Grande Prairie, Alberta. Her start-up costs were $58 374.97. She has an average of $21 364.15 in operating expenses each month. If she earns an average of $36 092.63 in revenue per month, the number of months it will take her to break even is (Round to the nearest month)

Question

Candy has opened a mechanic's garage in Grande Prairie, Alberta. Her start-up costs were $58 374.97. She has an average of $21 364.15 in operating expenses each month. If she earns an average of $36 092.63 in revenue per month, the number of months it will take her to break even is (Round to the nearest month)

Answer 1

To find the number of months it will take Candy to break even, we need to determine her monthly profit:

Profit = Revenue - Operating Expenses

Profit = $36,092.63 - $21,364.15
Profit = $14,728.48

Now, we can calculate the number of months it will take Candy to break even:

Break-even = Startup Costs / Profit
Break-even = $58,374.97 / $14,728.48
Break-even ≈ 3.96 months

Therefore, it will take Candy approximately 4 months to break even.