Helicopter Rides.The price of each ticket is $150 and the variable costs average $60 per person....
Helicopter Rides.The price of each ticket is $150 and the variable costs average $60 per person. Steve's monthly fixed costs are $58,500. 1. What is Steve's contribution margin per ride? 2. How many tours must the company conduct in a month to break even? 3. What sales revenue is needed to produce a net profit of $36,000 per month? 4. What is Steve's contribution margin ratio? 5. If annual sales increase by $100,000, by what amount will operating income increase? 6. If annual sales decrease by $50,000, by what amount will operating income decrease?
I need help with #5 & #6
Homework Answers
1) Contribution margin per ride = 150-60 = 90 per person
2) Break even = 58500/90 = 650
3) Required revenue = (58500+36000)/0.60 = $157500
4) Contribution margin ratio = 90/150 = 60%
5) Operating income increase by = 100000*60% = 60000
6) Operating income decrease by = 50000*60% = -30000
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Helicopter Rides.The price of each ticket is $150 and the
variable costs average $60 per person....
Steve’s Helicopter Rides takes tourists on helicopter tours of Hawaii. The price of each ticket is...
Steve’s Helicopter Rides takes tourists on helicopter tours of Hawaii. The price of each ticket is $150 and the variable costs average $60 per person. Steve’s monthly fixed costs are $58,500. 5.If annual sales increase by $100,000, by what amount will operating income increase? 6.If annual sales decrease by $50,000, by what amount will operating income decrease?
Steve’s Helicopter Rides takes tourists on helicopter tours of Hawaii. The price of each ticket is...
Steve’s Helicopter Rides takes tourists on helicopter tours of Hawaii. The price of each ticket is $150 and the variable costs average $60 per person. Steve’s monthly fixed costs are $58,500. If annual sales increase by $100,000, by what amount will operating income increase? If annual sales decrease by $50,000, by what amount will operating income decrease?
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