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E10.23 (LO 2, 3) Service Excel The Richibouctou Inn is trying to determine its break-even point. The inn has 75 rooms available that are rented
E10.23 (LO 2, 3) Service Excel The Richibouctou Inn is trying to determine its break-even point. The inn has 75 rooms available that are rented at $50 a night. Operating costs are as follows: Salaries $10,000 per month Maintenance $500 per month Utilities $2,000 per month Housekeeping service $5 per room Depreciation $1,000 per month Other costs $25 per room Instructions a. Determine the inn's break-even point in (1) the number of rented rooms per month and (2) dollars. b. If the inn plans on renting 30 rooms per day (assuming a 30-day month), what is (1) the monthly margin of safety in dollars and (2) the margin of safety ratio? Calculate the variable cost per unit, contribution margin ratio, and increase in fixed costs
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