Question

Costa is an accountant. During tax season, he charges \($125$to do a simple tax return. His expenses for buying software, renting an office, and advertising are \)$6,000$. How many tax returns must he do if he wants to make a profit of at least $$8,000$?

Short answer

He should do $112$tax returns.

Step-by-step solution

Step 1. Given information

Total fixed expenses$=\$6000$

Cost charged per tax return is$=\$125$

Total profit required is$\$8000$

Step 2. Solving the inequality

According to the question,

$125t-6,000\ge 8,000$

where $t$are the total number of tax returns.

On simplifying,

$$\begin{gathered} 125t\ge 8,000+6,000 \\ 125t\ge 14,000 \\ t\ge \frac{14,000}{125} \\ t\ge 112 \end{gathered}$$