Break-Even Sales and Sales Mix for a Service Company

Zero Turbulence Airline provides air transportation services between Los Angeles, California; and Kona, Hawaii. A single Los Angeles to Kona round-trip flight has the following operating statistics:

Fuel $16,751 Flight crew salaries 12,830 Airplane depreciation 6,059 Variable cost per passengerbusiness class 40 Variable cost per passengereconomy class 30 Round-trip ticket pricebusiness class 580 Round-trip ticket priceeconomy class 300 It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight. If required round the answers to nearest whole number.

a.Compute the break-even number of seats sold on a single round-trip flight for the overall product, E. Assume that the overall product is 10% business class and 90% economy class seats.

Total number of seats at break-even fill in the blank 1

seats b.How many business class and economy class seats would be sold at the break-even point?

Business class seats at break-even fill in the blank 2

seats Economy class seats at break-even