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Babolat Park competes with Water World by providing a variety of rides. Babolat Park sells tickets at $80 per person as a one-day entrance fee.

Babolat Park competes with Water World by providing a variety of rides. Babolat Park sells tickets at $80 per person as a one-day entrance fee. Variable costs are $34 per person, and fixed costs are $326,800 per month. (33 points)

  1. Compute the contribution margin per unit and the number of tickets Babolat Park must sell to break even. Perform a numerical proof to show that your answer is correct.
  2. Compute Babolat Parks contribution margin ratio. Carry your computation to two decimal places. Use the contribution margin ratio approach to determine the sales revenue Babolat Park needs to break even.
  3. Suppose Babolat Park cuts its ticket price from $80 to $54 to increase the number of tickets sold. Compute the new breakeven point in tickets and in sales dollars.

d) Ignore the information in question a. Instead, assume that Babolat Park increases the variable cost from $34 to $40 per ticket. Compute the new breakeven point in tickets and in sales dollars

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