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Question Help Mountaintop golf course is planning for the coming season. Investors would ike to eam a 12% return on the company's $45,000,000 of assets. The company primarily incurs fxed costs to groom the greens and fairways. Fixed costs are projected to be $23,000,000 for the golfing season. About 410,000 golfers are expected each year. Variable costs are about $16 per goler. Mountaintop golf course has a favorable reputation in the area and therefore, has some control over the price of a round of golf. Using a cost-plus approach, what price should Mountaintop charge for a round of goir? OA. $72.10 O B. $85.27 O C. $16.00 O D. $122.93

Answer 1

Total variable costs ( 410000 * 16 )	6560000
Total fixed costs	23000000
Total costs	29560000
(+) Desired return ( 12% * 45000000 )	5400000
Total sales value	34960000
(/) Total number of round of golf	410000
Price for a round of gold	85.27