5. Soft Echo Resort & Spa is one of the largest resorts in Michigan. This resort has 150 rooms. In 2022, its average daily rate is $220. Thanks to the rebound in travel demand after COVID, the resort's occupancy reached 80% in 2022.

In 2022, the fixed costs were $500,000, and the unit variable cost was $132 per room night.

Located in northern Michigan, Soft Echo Resort & Spa was closed for most of the winter season. It opened 200 days in 2022.

In 2023, the general manager wants to increase operating income from the current level to $300,000. She decides to do the following adjustments:

• Spend additional $50,000 per year to be promoted by local celebrities
• To motivate the staff, the owner created a $5,000 prize to the best employee of the year
• Send scented candles to guests, which costs $2 per room night
• Increase ADR by $20

Given the above info, answer the following questions.

a. What are the fixed costs in 2023?

b. Considering price changes and potential increased unit variable cost (e.g., candles), what is the unit contribution margin ($) in 2023?

c. What is the required number of rooms the resort needs to sell per night, in 2023?

d. What is the average occupancy (use percentage, such as 60% instead of 0.6) that the resort needs to achieve in 2023?