Tanika is planning to open a consulting practice based in a shared office facility. Her monthly fixed costs will total $2,500 plus she must earn at least $7,500 per month to replace her salary and benefits. She plans to charge $65 per hour for her consulting services and will have direct costs of $15 per hour for a gross profit of $50 per hour. How many hours of consulting must she bill per month?
A) 200 hours
B) 50 hours
C) 150 hours
D) None of the above

Question

Quizplus · Accepted Answer

To cover her monthly fixed costs and salary replacement ($2,500 + $7,500 = $10,000) at a gross profit of $50 per hour, she needs to bill 200 hours ($10,000 / $50 per hour = 200 hours).

Tanika Is Planning to Open a Consulting Practice Based in a Shared