Exercise 19-1 The Bonita Inn is trying to determine its break-even point. The inn has 75 rooms that are rented at $56 a night. Operating costs are as follows. Salaries $13,660 per month Utilities 2,310 per month Depreciation 1,200 per month Maintenance 890 per month Maid service 7 per room Other costs 35 per room

Determine the inns break-even point in (1) number of rented rooms per month and (2) dollars.

1. Break-even point in rooms

2. Break-even point $

If the inn plans on renting an average of 50 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? (Round ratio to 1 decimal place, e.g. 10.5%.)

1. Margin of safety $

2. Margin of safety ratio %