Fixed Costs, or overhead, are expenses that are the same no matter how much product you sell. Identify the fixed costs for your cafe, estimate the monthly amount for each, and calculate the monthly total.

Question

Business

Elisha Copeland

20 March, 03:28

Fixed Costs, or overhead, are expenses that are the same no matter how much product you sell. Identify the fixed costs for your cafe, estimate the monthly amount for each, and calculate the monthly total.

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Answers (1)

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Damon Powell · Answer 1

Total cost = $14,720 per month.

Explanation:

There is a kiosk café near my house that runs for 40 hours a week and its fixed cost comprises of basically of rent and labour, it employs a Barista, a baker and a manager. Below is what the total fixed cost looks like

Rent = $8000 Per month

Labour (barista$8, baker$8 and manager$14 all per hour) = $6720 (assuming a 160 working hours per month.

Therefore, the overhead cost is $14,720 per month.