Suppose FunTime Cruiseline cuts its dinner cruise ticket price from $50 to $45 to in- crease the number of passengers. Compute the new breakeven point in units and in sales dollars. Explain how changes in sales price generally affect the breakeven point. Assume that FunTime Cruiseline does not cut the price. FunTime Cruiseline could re- duce its variable costs by no longer serving an appetizer before dinner. Suppose this operating change reduces the variable expense from $30 to $20 per passenger. Com- pute the new breakeven point in units and in dollars. Explain how changes in variable costs generally affect the breakeven point.

Suppose FunTime Cruiseline cuts its dinner cruise ticket price from $50 to $45 to in- crease the number of passengers. Compute the new breakeven point in units and in sales dollars. Explain how changes in sales price generally affect the breakeven point. Assume that FunTime Cruiseline does not cut the price. FunTime Cruiseline could re- duce its variable costs by no longer serving an appetizer before dinner. Suppose this operating change reduces the variable expense from $30 to $20 per passenger. Com- pute the new breakeven point in units and in dollars. Explain how changes in variable costs generally affect the breakeven point.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 12EB: Able Transport operates a tour bus that they lease with terms that involve a fixed fee each month...

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FunTime Cruiseline offers nightly dinner cruises departing from several cities on the cu ern coast of the United States including Charleston, Baltimore, and Alexandria. Dinner cruise tickets sell for $50 per passenger. FunTime Cruiseline's variable cost of providing the dinner is $30 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $210,000 per month. The company's rel- evant range extends to 20,000 monthly passengers. d. Use the contribution margin ratio to project operating income if monthly sales rev- S7-1 Compute unit contribution margin and contribution margin ratio (Learning Objective 1) Use the information from the FunTime Cruiseline Data Set to compute the following a. What is the contribution margin per passenger? b. What is the contribution margin ratio? c. Use the unit contribution margin to project operating income if monthly sales toda 17,000 passengers. enue totals $595,000.
amounts with a $0 balance, make sure to enter " 0 " in the appropriate input field.) Now compute the breakeven point in sales dollars. Enter the formula, then compute the breakeven sales. (Enter the contribution margin ratio as a whole percent. For amounts with a $0 balance, make sure to enter " 0 " in the appropriate input field.)
Super Cruiseline offers nightly dinner cruises departing from several cities on the eastern coast of the United States including Charleston, Baltimore, and Alexandria. Dinner cruise tickets sell for $50 per passenger. Super Cruiseline's variable cost of providing the dinner is $20 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $270,000 per month. The company's relevant range extends to 19,000 monthly passengers. Use this information to compute the following: a. What is the contribution margin per passenger? b. What is the contribution margin ratio? c. Use the unit contribution margin to project operating income if monthly sales total 16,000 passengers. d. Use the contribution margin ratio to project operating income if monthly sales revenue totals $520,000.
Super Cruiseline offers nightly dinner cruises departing from several cities on the East Coast of the United States including Charleston, Baltimore, and Alexandria. Dinner cruise tickets sell for $80 per passenger. Super Cruiseline's variable cost of providing the dinner is $40 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $240,000 per month. The company's relevant range extends to 18,000 monthly passengers. If Super Cruiseline sells an additional 600 tickets, by what amount will its operating income increase (or operating loss decrease)? First, identify the formula, then compute the operating income increase (or operating loss decrease). Operating =
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Super Cruiseline offers nightly dinner cruises departing from several cities on the eastern coast of the United States including Charleston, Baltimore, and Alexandria. Dinner cruise tickets sell for $80 per passenger. Super Cruiseline's variable cost of providing the dinner is $40 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $240,000 per month. The company's relevant range extends to 14,000 monthly passengers. Use this information to compute the following: a. What is the contribution margin per passenger? b. What is the contribution margin ratio? c. Use the unit contribution margin to project operating income if monthly sales total11,000 passengers. d. Use the contribution margin ratio to project operating income if monthly sales revenue totals $515,000.
JetTaxi is a passenger airplane line that contracts with larger, well-known lines to provide transportation across the United States. JetTaxi owns 30 aircraft, and currently has contracts for 20 of those aircraft. JetTaxi normally charges $2,700,000 each year per jet to provide the carrier services. Each JetTaxi plane incurs yearly costs of $600,000 for labor, $200,000 for fuel, $400,000 in fixed overhead, and $800,000 in variable overhead. JetTaxi is considering a new contract where they would provide 5 airplanes to a new company for $2,000,000 each year per jet. Should JetTaxi accept the contract? Why? Group of answer choices No, because the differential net income would be zero. Yes, because the differential net income would be $1.6M. No, because the differential net income would be - $2M. Yes, because the differential net income would be $2M.
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