Q # 01

list price of new car 14,400

cost of new car 12,240 Revenue
gross profit (new car) 2,160 New car
sale of used car 7,100 old car
cost of used car 6,500 service
repair cost 1,594 Costs
gross profit (used car) - 994 New car
gross profit (dealership 1,166 Old car
service
Q # 02
(A)
retail price of used car 7,100
blue book repair cost 2,000
transfer price 5,100

(B)
same as outside customers 2,042

C
service department used cars department
sale of repair 2,042 blue book price 5,800 trade in retail price
cost of repair 1,594 price of repair 2,042 transfer price
profit 448 transfer price 3,758 price of repair
profit

total incremental profit

service department 448
used cars department 1,300
new cars department - 582
1,166

Q#3
listing price 14,400 listing price 14,400
cost - 12,240 cost - 12,240
trade in cost - 6,500 trade in cost - 6,500
repair cost - 1,594 old car sale 5,000
old car sale 7,100 repair revenue 2,042
profit 1,166 repair cost - 1,594
profit 1,108
 New car Old car Repair

7,900
6,500 7,100
1,594

12,240
6,500
1,594 1,594
2,160 - 994 - 1,166

ent new cars department

7,100 list price 14,400
3,758 cost 12,240
2,042 trade in 6,500
1,300 transfer price 3,758
profit - 582