Question
A 90-room motel has an average room rate of $65.60. Its fixed costs are $300,000 a year, and its variable costs total $476,000 at an
A 90-room motel has an average room rate of $65.60. Its fixed costs are $300,000 a year, and its variable costs total $476,000 at an average occupancy of 70 percent.
a. What is the motel’s breakeven occupancy percentage?
b. What level of sales revenue is required to provide an operating income (before taxes) of $100,000 a year?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
a b C d e f g h i j k 1 j k 3 No of rooms 90 Fixed co...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Cost Accounting Foundations and Evolutions
Authors: Michael R. Kinney, Cecily A. Raiborn
9th edition
9781285401072, 1111971722, 1285401077, 978-1111971724
