1 2 EG.1 Compute break-even paint and margin of safety 3 4 5 6 7 8 9 10 11 a The Soma Inn is trying to determine its break-even point. The inn has 75 rooms that are rented at $60 a night. Operating costs are as follows. Salaries Utilities $10,600 2,400 per month per month Depreciation 1,500 per month Maintenance 800 per month Maid service 8 per room Other costs 34 per room Instructions a. 12 13 14 15 16 b. 17 18 19 Determine the inn's break-even point in (1) number of rented rooms per month and (2) sales dollars. If the inn plans on renting an average of 50 rooms per day (assuming a 30- day month), what is (1) the monthly margin of safety in dollars and (2) the margin of safety ratio? 20 NOTE: Enter a formula, a cell reference, or a value (if you are unable to reference a celll. into the vellow shaded input cells. 21 22 23 24 25 a. 26 27 28 29 30 31 32 33 34 35 36 37 38 35 40 1 32 3 4 5 6 7 8 9 b. (1) Breakeven point in rooms Rental per room Variable cost per room Contribution margin per room Fixed costs Contribution margin per room Break-even point in rooms (2) Break-even point in dollars Contribution margin per room Rental per room Contribution margin ratio Break-even point in rooms Rental per room Break-even point in dollars OR Fixed cost Contribution margin ratio Break-even point in dollars (1) Margin of safety in dollars Expected rental revenues Break-even sales Margin of safety in dollars 121 Marain of safeturatio Margin of safety in dollars Expected rental revenues Margin of safety ratio