EX 3-37

Bristol Car Service offers airport service in a mid-size city. Bristol charges $62 per trip to or from the airport. The variable cost for a trip totals $30, for fuel, driver, and so on. The monthly fixed cost for Bristol Rainbow Tours is $6,720.

Required:

a. How many trips must Bristol sell every month to break even?

b. Bristol's owner believes that 225 trips is a reasonable forecast of the average monthly demand. What is the margin of safety in terms of the number of airport trips?