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1. Total revenue and variable costs are based on the following: Selling price per meal Variable cost per meal Budgeted number of meals Business class
1. Total revenue and variable costs are based on the following: Selling price per meal Variable cost per meal Budgeted number of meals Business class meals R150 R60 15 million Economy class meals R80 R50 30 million 2. Other income consists of interest income earned on surplus cash available. 3. Allocated head office overheads are apportioned between business class and economy class meals based on the budgeted number of meals. Required: 1. What is the total break-even revenue for the year? R 2. What is the break-even number of business class meals and economy class meals respectively? Business class: meals Economy class: meals JWM (Pty) Ltd is an airline catering business which supplies business class and economy class meals for the airline industry. The following bodgeted information relates to the finmcial you enting 31 July Botines classe meals Economy class meak Total Notes R. Ra R Total Revenue 1 2 250 2 400 4 650 Total variable costs 1 900 1 500 2400 Other income 2 10 Fixed costs 800 Allocated head office overheads 3 100 Notes: 1. Total revenue and variable costs are based on the following: Business class meals Economy class meals Selling price per meal R150 R80 Variable cost per meal R60 R50 Budgeted number of meals 15 million 30 million 2. Other income consists of interest income earned on surplus cash available. 3. Allocated head office overheads are apportioned between business class and economy class meals based on the budgeted number of meals. Required: 1. What is the total break-even revenue for the year?R 2. What is the break-even number of business class meals and economy class meals respectively? Business class meals Economy class meals
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