Question
Barossa Valley Hot Air Ballooning is considering selling hot air balloon rides next year in January 2022. The following information is relevant Hot air balloon
Barossa Valley Hot Air Ballooning is considering selling hot air balloon rides next year in January 2022.
The following information is relevant
Hot air balloon rides fee charged to a customer
Hot air balloon rides fee charged to a customer | $1,500 |
Lease of the hot air balloons | $750,000,000 |
Set up cost per air hot balloon rides | $200 |
Fuel cost per air hot balloon rides | $100 |
REQUIRED:
A) How many balloon rides will Barossa Valley Hot Air Ballooning need to provide in order to break-even? (must show workings) (3 marks)
B) Explain what the consequence/impact will be if the Barossa Valley Hot Air Ballooning has 7,890 hot air balloon rides for January 2022? (must show workings) (1 mark)
C) Explain what the consequence/impact will be if the Barossa Valley Hot Air Ballooning has 2,435 hot air balloon rides for January 2022? (must show workings) (2 mark)
D) Calculate the number of hot air balloon rides required for the Barossa Valley Hot Air Ballooning, if the business to earn a desired profit of $3,300,000. (must show workings)
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