a.(1) Break-Even point in number of rented rooms per months |
Selling price per unit $60 |
Variable cost per unit $42 ($8 + $34) |
Fixed cost $15,300 ($10,600 + $2,400 + $1,500 + $800) |
Break-even Point in rooms = Fixed Cost / Contribution Margin per unit |
= $15,300 / ($60 - $42) |
= 850 Rooms |
a.(1) Break-Even point in dollars. |
Break-even point in dollars = Break-even Point in rooms * Selling Price per unit |
= 850 Rooms * $60 |
= $51,000. |
b. (1) Margin of safety = Budgeted sales - Break-even sales |
Budgeted sales = 50 rooms * 30 days * $60 |
= $90,000 |
Break-even sales in dollars = $51,000 |
Margin of safety = $90,000 - $51,000 |
= $39,000. |
Margin of safety ratio = ($39,000 / $91,000) * 100 |
= 0.4286 or 42.86%. |
brak even pou and margin E6.1 (LO 1), AP Service The Soma Inn is trying to...
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