Great Cruiseline offers nightly dinner Cruises departing from several cities on the eastern coast of the United States including Charleston, Baltimore, and Alexandria. Dinner Cruise tickets sell for $60 per passenger. Great Cruiseline's variable cost of providing the dinner is $30 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $270,000 per month. Under these conditions, the breakeven point in tickets is 9,000 and the breakeven point in sales dollars is $540,000. Suppose Great Cruiseline cuts its dinner cruise ticket price from $60 to $50 to increase the number of passengers. Compute the new breakeven point in units and in sales dollars. Explain how changes in sales price generally affect the breakeven point. Assume that Great Cruiseline does not cut the price. Great Cruiseline could reduce its variable costs by no longer serving an appetizer before dinner. Suppose this operating change reduces the variable expense from $30 to $15 per passenger. Compute the new breakeven point in units and in dollars. Explain how changes in variable costs generally affect the breakeven point. 1. Suppose Great Cruiseline cuts its dinner cruise ticket price from $60 to $50 to increase the number of passengers. Compute the new breakeven point in units and in sales dollars. Explain how changes in sales price generally affect the breakeven point Begin with the breakeven point in units. Enter the formula, then compute the breakeven point. (Round your final answers up to the nearest whole number. For amounts with a $0 balance, make sure to enter in the appropriate coll.) - Breakeven units Now compute the breakeven point in sales dollars. Enter the formula, then compute the breakeven sales. (Enter the contribution margin ratio as a whole percent. For amounts with balance, make sure to enter "0in the appropriate cell) Breakeven sales All else being constant, a decrease in sales price will the contribution margin per unit and contribution margin ratio. The breakeven point will therefore 2. Assume that Great Cruiseline does not out the price. Great Cruiseline could reduce its variable costs by no longer serving an appetizer before dinner. Suppose this operating change reduces the variable expense from $30 to $15 per passenger Compute the new breakeven point in units and in dollars. Explain how changes in variable costs generaly affect the breakeven point. Let's begin with the breakeven point units. Enter the formula, then compute the breakeven point in units. (Round your final answers up to the nearest whole number. For amounts with a 30 balance, make sure to enter in the appropriate cell) Breakeven units Now compute the breakeven point in sales dollars. Enter the formula, then compute the breakeven point in sales. (Enter the contribution margin ratio as a whole percent. For amount So balance, make sure to enter "o" in the appropriate ) Breakeven sales Aloise being equal, a decrease in variable costs will the contribution margin per unit and the contribution margin ratio. The breakeven point will therefore
