Exercise $7-26$

Sports Franchise; CVP Graph

$($LO$7-3,7-4)$

The Houston Armadillos, a minor$-$league baseball team, play their weekly games in a small stadium just outside Houston. The stadium holds $10,000$ people and tickets sell for $$10$ each. The franchise owner estimates that the team's annual fixed expenses are $$180,000,$ and the variable expense per ticket sold is $$1.($In the following requirements, ignore income taxes.$)$

page $320$

Required:

Draw a cost$-$volume$-$profit graph for the sports franchise. Label the axes, break$-$even point, profit and loss areas, fixed experises, variable expenses, total$-$expense line, and total$-$revenue line.

If the stadium is half full for each game, how many games must the team play to break even?