25 8 00 thinking about dropping several fights that appear to be unprofitable At Pegasus Artines in an effort to improve the company's performance, the company A typical income statement for one round trip of one such flight light 482) is as follows Ticket revenue (200 seats 40% occupancy $210 ticket price) Variable expenses ($15.00 per person) Contribution margin Flight expenses Salaries, flight crew right promotion Depreciation of aircraft Fuel for aircraft Liability insurance Salaries, right assistants Baggage Icating and light preperation Overnight custs for light crew and assistants et destination Total flight expenses Net coerating I $14,000 100. 1,200 7.1 92.9% $2,000 770 1,750 5,300 4,500 1,850 700 18,270 $(7.67) The following additional information is available about flight 482 e. Members of the fight crew are paid fixed annual salaries, whereas the flight assistants are paid based on the number of round tripe they complete One-third of the liability insurance is a special charge assessed against fight 482 beceuse in me opinion of the insurance company the destination of the fight is in a "high risk aree. The remaining two-thirds would be unaffected by a decision to drop tight 482 The baggage loading and flight preparation expense is an allocation of ground crens' salaries and depreciation of ground equipment Dropping flight 482 would have no effect on the company's tote baggage loading and fight preparation expenses dfight 482 is dropped Pegasus Airlines has no authorization at present to replace it with another fight e Aircraft depreciation is due entirely to obsolescence Depreciation due to wear and tear is negligible Dracoina fight 482 would not slow Pegasus Airlines to reduce the number of accrat in its foot or the number of flight crew o