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Charleston Carriage Company offers guided horse-drawn carriage rides through historic Charleston, South Carolina. The company shut down in 2020 because of the Covid virus, but
Charleston Carriage Company offers guided horse-drawn carriage rides through historic Charleston, South Carolina. The company shut down in 2020 because of the Covid virus, but it hopes to resume business later this spring. The carriage business is highly regulated by the city, and the expected fare for all passengers is $22.00. The company budgets the following monthly operating costs for this year: Fee paid to the city of Charleston 13% of ticket revenue Cost of souvenir set of postcards given to each passenger $0.50 per set Monthly cost of leasing and boarding the horses $44,000 Carriage drivers (tour guides) are paid on a per-passenger basis $2.80 per passenger Monthly payroll costs of non tour guide employees $8,500 Marketing, web-site, telephone, and other monthly fixed costs $7,000 In addition to these costs, Charleston Carriage will have to pay a brokerage fee of $0.90 per ticket sold by brokers. On average, 65% of all tickets sold are sold by brokers; 35% are sold directly by Charleston Carriage. Charleston Carriage has several questions about its expected monthly revenues, costs, and profits in 2022. 7. Charleston Carriage has an opportunity to negotiate with the company that leases and boards the horses. If Charleston expects to sell 4,902 tickets per month in 2022 and wants to break even each month, what's the most it could pay per month to lease and board the horses (ignoring taxes)
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