Three College Students Consider the Option of Forming a Lawn

question 46

Essay

Three college students consider the option of forming a lawn care and landscaping business during their summer vacation. They estimate the following costs:
$\begin{array} { | l | l | } \hline \text { Insurance } & \$ 2,600 \\\hline \text { Equipment Rental Fees } & \$ 1,000 \\\hline \text { Fuel and Supplies } & \$ 4 \text { per lawn } \\\hline \text { Miscellaneous Expenses } & \$ 2 \text { per lawn } \\\hline\end{array}$ Their projected revenue depends on the number of lawns serviced. The price per job is $30. The going wage for a typical unskilled college student is about $2,400 for the summer months. Derive an equation for total accounting profit and total economic profit. Should the students launch the business if they expect to service about 200 lawn jobs during the summer?

Recognize the components of professionalism in a work environment.

Apply persuasive techniques in communications, particularly when delivering recommendations that could be negatively perceived.

Understand the least supportive and most common uses of communication within professional settings.

Appreciate the significance of strong communication skills in leadership and career progression.

---

Definitions:

Accounting Period

A span of time during which financial events are recorded and compiled into financial statements.

Variable Costs

Expenditures that fluctuate with the quantity of production or the volume of sales.

Specific Decision

A choice made in a particular situation, often necessitating the consideration of relevant information and specific circumstances.

Prime Cost

The sum of direct materials and direct labor costs associated with the production of goods.