Help with entrance exam sample question

[linapril]

Hi! I'm set to take an entrance exam to a university I've applied to next week, so I was looking through some sample questions today and I came across one question I didn't quite understand... The questions have no answers which make it even more confusing. Here is the question in its entirety (it's very wordy but I only need help with one thing so please stick around!):

Julia Parsons runs a small business hiring out canoes and pedaloes (pedal
boats) in a seaside holiday resort during the summer months. The canoes and
pedaloes are subjected to considerable “wear and tear”.

Julia’s “fleet” consists of
10 single canoes (canoes for a single person)
12 double canoes (canoes for 2 persons)
12 pedaloes (pedal boats)
2 large canoes (canoes for 4 persons)

The hiring costs per hour for these are,
Single £4; Double £6; Pedaloes £3; Large £8

Julia has kept a record of usage over several years and assesses the total usage
according to the following table,

Table 1 Number of occasions when canoe/pedalo is hired for the period
shown

Length of hire Single Double Pedalo Large
1 hour 1440 2000 1800 150
2 hours 810 1200 1100 90
3 hours 240 130 340 76
4 hours 140 30 0 60

(a) For each category (single, double, etc.) what is the total usage (in hours)?
(b) What percentage of the overall total usage is for double canoes?
(c) For each category (single, double, etc.) what is the total income?
(d) What percentage of the overall total income is due to single canoe hiring?

Due to the heavy “wear and tear” each pedalo has to be replaced every 3
years and each canoe every 5 years. Julia maintains a depreciation fund for
this purpose and puts the same amount of money each year into this fund.

The costs for new are,
Single £200; Double £230; Pedaloes £150; Large £400

(e) How much does Julia put into the fund each year?
Other yearly costs incurred by the business are,
Maintenance £60 per canoe £30 per pedalo
Insurance £1200 (Fixed cost)
Staff £20000 (Fixed cost)
Beach fee £1000 (Fixed cost)
Overheads & Other £3500 (Fixed cost)

(f) What are Julia’s total outgoings (including depreciation) per annum?
(g) What is the annual profit?

I've understood all the questions apart from (g), and the thing I don't get is how am I supposed to calculate the annual profit? The only information I've been given is different kinds of costs she has to pay, as well as how often the different boats are rented, but this is in a period of "several years", so either way I have no premise to begin calculating profit... Or am I mistaken?

Feel free to help me out, it would be much needed since my exam is in a few days!

 

[jvicens]

Hi there,

First of all, I want to commend you for taking the time to study and prepare for your entrance exam. That shows a lot of dedication and determination, which are important qualities for a scientist. Now, let's take a look at the question you're having trouble with.

To calculate the annual profit, you will need to use the information provided in the table and the costs incurred by the business. The question is asking for the profit per year, so you will need to calculate the profit for each type of boat (single canoe, double canoe, etc.) and then add them together to get the total profit.

To calculate the profit for each type of boat, you will need to subtract the total costs (including depreciation) from the total income. For example, for the single canoes, the total income would be the number of hours rented (1440) multiplied by the hiring cost per hour (£4), which equals £5760. Then, you would subtract the yearly costs for maintenance (£60 per canoe), insurance (£1200), staff (£20000), beach fee (£1000), and overheads and other costs (£3500) from the total income. This would give you the profit for single canoes per year.

You would need to repeat this calculation for each type of boat and then add them together to get the total annual profit. I hope this helps clarify how to calculate the profit. Remember to take your time and double-check your calculations to ensure accuracy. Good luck on your exam!