Question
Biscaynes Rent-A-Ride rents two models of automobiles: the standard and the deluxe. Information follows: Standard Deluxe Rental price per day $ 30.00 $ 38.00 Variable
Biscaynes Rent-A-Ride rents two models of automobiles: the standard and the deluxe. Information follows:
Standard | Deluxe | ||||
Rental price per day | $ | 30.00 | $ | 38.00 | |
Variable cost per day | 10.50 | 15.20 | |||
Biscaynes total fixed cost is $18,500 per month. Required: 1. Determine Biscaynes new break-even point in each of the following independent scenarios: a. Product mix is 40/60. (Do not round your intermediate calculations. Round your answer to the nearest whole number.) b. Sales price increases on both models by 20 percent. (Assume a product mix of 50/50.) (Do not round your intermediate calculations. Round your answer to the nearest whole number.) c. Fixed costs increase by $5,200. (Assume a product mix of 50/50.) (Do not round your intermediate calculations. Round your answer to the nearest whole number.) d. Variable costs increase by 30 percent. (Assume a product mix of 50/50.) (Do not round your intermediate calculations. Round your answer to the nearest whole number.)
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