Find breakeven and target profit and prepare income statement (Learning Objectives 1,2)
International Productions performs Cats, the play. The average show sells 1,000 tickets at $60 a ticket. There are 120 shows a year. Cats has a cast of 60, each earning an aver¬ age of $320 a show. The cast is paid only after each show. The other variable expense is program printing costs of $8 per guest. Annual fixed expenses total $295,200.
Requirements 1. Compute revenue and variable expenses for each show.
2. Use the income statement equation approach to compute the number of shows Cats must perform each year to break even.

3. Use the shortcut contribution margin approach to compute the number of shows needed each year to earn a profit of $4,264,000. Is this profit goal realistic? Give your reason.
4. Prepare the Cats contribution margin income statement for 120 shows for the year. Report only two categories of expenses: variable and fixed.