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Classy Cruiseline offers nightly dinner cruises off the coast of Miami, San Francisco, and Seattle. Dinner cruise tickets sell for $50 per passenger. Classy Cruiseline's
Classy Cruiseline offers nightly dinner cruises off the coast of Miami, San Francisco, and Seattle. Dinner cruise tickets sell for $50 per passenger. Classy Cruiseline's variable cost of providing the dinner is $20 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $210,000 per month. The company's relevant range extends to 15,000 monthly passengers. Use this information to compute the following: a. What is the contribution margin per passenger? b. What is the contribution margin ratio? c. Use the unit contribution margin to project operating income if monthly sales total 12,000 passengers. d. Use the contribution margin ratio to project operating income if monthly sales revenue totals $490,000. a. What is the contribution margin per passenger? First identify the formula, then compute the contribution margin per passenger. ____________ - ___________ = Contribution margin per passenger ___________ - _____________ = _________ b. What is the contribution margin ratio? (Enter the contribution margin ratio as a whole percent.) First identify the formula, then compute the contribution margin ratio. _____________/____________ = Contribution margin ratio ______________/_____________ = _________ % c. Use the unit contribution margin to project operating income if monthly sales total 12,000 passengers
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