Answered step by step
Verified Expert Solution
Question
1 Approved Answer
just need help with question 6 Assignment #4 Below is the 2020 budgeted income statement and CVP data for Four Winds Hotel - Phoenix, a
just need help with question 6
Assignment #4 Below is the 2020 budgeted income statement and CVP data for Four Winds Hotel - Phoenix, a 600-room 4-star hotel in central Phoenix Percent Occupancy Revenue Variable Costs Contribution Margin Fixed Costs Operating Income before Tax Income Taxes Net Income After Tax Degrees of Operating Leverage (DOL) The Four Winds Hotel - Phoenix Profitability Analysis $15,600,000 $ 130.00 100.0% 5,400,000 $ 45.00 34.6% $10,200,000 $ 85.00 65.4% 9,200,000 $1,000,000 210,000 $790,000 10.2 54.8% 535,000,000 Average daily room-day rate Average variable cost per room-day Fixed cost per year Tax rate Number of room-days Percent occupancy Room-day capacity $130.00 $45.00 $9,200,000 21.0% 120,000 54.8% 219,000 CVP Analysis $10,000,000 $25.000.000 $10.000.000 $15,000,000 $10,000,000 $5,000,000 10.00 10,00 270.000 200.00 10.000 Address the following questions for Four Winds' management team. 1. How many room-days are needed for the hotel to achieve breakeven point? What is the percentage occupancy at breakeven? What is the daily number of rooms occupied on average at breakeven? 2. What is the Operating income before tax if the hotel operates at 60% of capacity for the year? tasl 6. Based on the original budget, create an example demonstrating that the DOL (degree of operating leverage) computation works Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started