Question

the owner of firewood to go is considering buying a hydraulic wood splitter which sells for $50,000. he figures it will cost an additional $92 per cord to purchase and split wood with this machine, while he can sell each cord of split wood for $124. what would the potential profit be if he were to split 4,000 cords of wood with this machine? (round your answer to a whole number.)

Answer 1

The profit for splitting 4,000 cords of wood with a hydraulic splitter is the revenue from sales minus the cost of splitting, which amounts to $128,000.

Step-by-step explanation:

To calculate the potential profit if the owner of Firewood To Go were to split 4,000 cords of wood with a hydraulic wood splitter, we need to subtract the total cost from the total revenue. The cost per cord to purchase and split wood with the machine is $92. The selling price per cord of split wood is $124.

The potential profit from splitting 4,000 cords of wood with the hydraulic wood splitter can be calculated by first determining the revenue from sales and then subtracting the combined costs of purchasing and operating the machine. The revenue per cord is $124, and the cost per cord is $92. To find the total profit, multiply the number of cords (4,000) by the profit per cord, which is the revenue per cord minus the cost per cord ($124 - $92 = $32 per cord). Therefore, the total profit for splitting 4,000 cords of wood would be 4,000 cords × $32 per cord.

First, calculate the total cost by multiplying the cost per cord by the number of cords: $92 * 4,000 = $368,000. Next, calculate the total revenue by multiplying the selling price per cord by the number of cords: $124 * 4,000 = $496,000. Finally, subtract the total cost from the total revenue to find the potential profit: $496,000 - $368,000 = $128,000.