Lonely Planet provides travel services on the Internet, 2011 was an important year for Lonely Planet as it reported positive operating income after 3 years of operating losses. In the first quarter of 2010, Lonely Planet reported an operating loss of $27 million on sales revenue of $49 million. In the first quarter of 2011, sales revenue had more than doubled to $99 million, and Lonely Planet had operating income of $20 milion. Assume that fixed costs were the same in 2011 as in 2010. Requirements 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ Sales revenue Less Operating income (loss) $ (27) milion million 76 milion Operating expenses Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in milions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX) 0.06 $ in 2011 wiped out the 99 million 20 million 79 Requirement 3. Explain how Lonely Planet's operating income could increase by $47mition with an increase in sales of $50 million, while it had an operating loss of $27 million on its 140 milion of sales in the first quarter of 2010 Because the entire the increased sales in 2011 went directly to The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 49 million $ Sales revenue 99 million 20 Less: Operating income (loss) million 79 Operating expenses million million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in million nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX.) Y 73 0.06 Because pages (27) million 76 Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on i sales in the first quarter of 2010. the increased sales in 2011 went directly to Cal $ 2011 the entire, fixed costs do not change operating income does not change sales do not change total costs do not change variable costs do not change Clear all The increased Check a Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 49 million $ (27) million 76 Sales revenue Less: Operating income (loss) Operating expenses million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to the nearest million, "XX" Enter variable cost in decimal form to two decimal places, XX) = $ 73 0.06 X million in 2011 wiped out the 2011 99 million 20 million 79 Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. Because the entire the increased sales in 2011 went directly to additional contribution margin provided by additional variable costs provided by decrease in fixed costs from The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2011 2010 49 million $ (27) million 99 million 20 million 79 million Operating expenses Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX.) 0.06 X Sales revenue Less: Operating income (loss) million Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 milion on its $49 million of sales in the first quarter of 2010 Because in 2011 wiped out the the entire the increased sales in 2011 went directly to feed costs. The increased operating income total sales Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ Sales revenue Less: Operating income (loss) Because $ Operating expenses million million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to tr nearest milion, "XX". Enter variable cost in decimal form to two decimal places, XX.) Y 73 0.06 X contribution margin fixed costs (27) million $ 76 vanable costs Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. In 2011 wiped out the $ 99 million 20 79 million the entire the increased sales in 2011 went directly to The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ 99 million 20 (27) million million million 76 79 Operating expenses million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total foxed cost in milions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX) YS 73 0.06 Sales revenue Less: Operating income (loss) Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010 Because in 2011 wiped out the the entire Ythe increased sales in 2011 went directly to additional variable costs in 2011, resulting in operating income for 2011. fixed costs in 2010, resulting in operating income during 2011. operating loss from 2010, with additional contribution margin resulting in operating income for 2011. The increased Lonely Planet provides travel services on the Internet, 2011 was an important year for Lonely Planet as it reported positive operating income after 3 years of operating losses. In the first quarter of 2010, Lonely Planet reported an operating loss of $27 million on sales revenue of $49 million. In the first quarter of 2011, sales revenue had more than doubled to $99 million, and Lonely Planet had operating income of $20 milion. Assume that fixed costs were the same in 2011 as in 2010. Requirements 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ Sales revenue Less Operating income (loss) $ (27) milion million 76 milion Operating expenses Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in milions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX) 0.06 $ in 2011 wiped out the 99 million 20 million 79 Requirement 3. Explain how Lonely Planet's operating income could increase by $47mition with an increase in sales of $50 million, while it had an operating loss of $27 million on its 140 milion of sales in the first quarter of 2010 Because the entire the increased sales in 2011 went directly to The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 49 million $ Sales revenue 99 million 20 Less: Operating income (loss) million 79 Operating expenses million million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in million nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX.) Y 73 0.06 Because pages (27) million 76 Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on i sales in the first quarter of 2010. the increased sales in 2011 went directly to Cal $ 2011 the entire, fixed costs do not change operating income does not change sales do not change total costs do not change variable costs do not change Clear all The increased Check a Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 49 million $ (27) million 76 Sales revenue Less: Operating income (loss) Operating expenses million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to the nearest million, "XX" Enter variable cost in decimal form to two decimal places, XX) = $ 73 0.06 X million in 2011 wiped out the 2011 99 million 20 million 79 Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. Because the entire the increased sales in 2011 went directly to additional contribution margin provided by additional variable costs provided by decrease in fixed costs from The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2011 2010 49 million $ (27) million 99 million 20 million 79 million Operating expenses Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX.) 0.06 X Sales revenue Less: Operating income (loss) million Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 milion on its $49 million of sales in the first quarter of 2010 Because in 2011 wiped out the the entire the increased sales in 2011 went directly to feed costs. The increased operating income total sales Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ Sales revenue Less: Operating income (loss) Because $ Operating expenses million million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to tr nearest milion, "XX". Enter variable cost in decimal form to two decimal places, XX.) Y 73 0.06 X contribution margin fixed costs (27) million $ 76 vanable costs Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. In 2011 wiped out the $ 99 million 20 79 million the entire the increased sales in 2011 went directly to The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ 99 million 20 (27) million million million 76 79 Operating expenses million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total foxed cost in milions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX) YS 73 0.06 Sales revenue Less: Operating income (loss) Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010 Because in 2011 wiped out the the entire Ythe increased sales in 2011 went directly to additional variable costs in 2011, resulting in operating income for 2011. fixed costs in 2010, resulting in operating income during 2011. operating loss from 2010, with additional contribution margin resulting in operating income for 2011. The increased Lonely Planet provides travel services on the Internet, 2011 was an important year for Lonely Planet as it reported positive operating income after 3 years of operating losses. In the first quarter of 2010, Lonely Planet reported an operating loss of $27 million on sales revenue of $49 million. In the first quarter of 2011, sales revenue had more than doubled to $99 million, and Lonely Planet had operating income of $20 milion. Assume that fixed costs were the same in 2011 as in 2010. Requirements 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ Sales revenue Less Operating income (loss) $ (27) milion million 76 milion Operating expenses Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in milions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX) 0.06 $ in 2011 wiped out the 99 million 20 million 79 Requirement 3. Explain how Lonely Planet's operating income could increase by $47mition with an increase in sales of $50 million, while it had an operating loss of $27 million on its 140 milion of sales in the first quarter of 2010 Because the entire the increased sales in 2011 went directly to The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 49 million $ Sales revenue 99 million 20 Less: Operating income (loss) million 79 Operating expenses million million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in million nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX.) Y 73 0.06 Because pages (27) million 76 Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on i sales in the first quarter of 2010. the increased sales in 2011 went directly to Cal $ 2011 the entire, fixed costs do not change operating income does not change sales do not change total costs do not change variable costs do not change Clear all The increased Check a Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 49 million $ (27) million 76 Sales revenue Less: Operating income (loss) Operating expenses million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to the nearest million, "XX" Enter variable cost in decimal form to two decimal places, XX) = $ 73 0.06 X million in 2011 wiped out the 2011 99 million 20 million 79 Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. Because the entire the increased sales in 2011 went directly to additional contribution margin provided by additional variable costs provided by decrease in fixed costs from The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2011 2010 49 million $ (27) million 99 million 20 million 79 million Operating expenses Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX.) 0.06 X Sales revenue Less: Operating income (loss) million Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 milion on its $49 million of sales in the first quarter of 2010 Because in 2011 wiped out the the entire the increased sales in 2011 went directly to feed costs. The increased operating income total sales Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ Sales revenue Less: Operating income (loss) Because $ Operating expenses million million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total fixed cost in millions rounded to tr nearest milion, "XX". Enter variable cost in decimal form to two decimal places, XX.) Y 73 0.06 X contribution margin fixed costs (27) million $ 76 vanable costs Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010. In 2011 wiped out the $ 99 million 20 79 million the entire the increased sales in 2011 went directly to The increased Requirement 1. Compute the operating expenses for Lonely Planet in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 49 million $ 99 million 20 (27) million million million 76 79 Operating expenses million Requirement 2. Determine the cost function for Lonely Planet, that is, the total fixed cost and the variable cost as a percentage of sales revenue. (Enter the total foxed cost in milions rounded to the nearest million, "XX". Enter variable cost in decimal form to two decimal places, XX) YS 73 0.06 Sales revenue Less: Operating income (loss) Requirement 3. Explain how Lonely Planet's operating income could increase by $47 million with an increase in sales of $50 million, while it had an operating loss of $27 million on its $49 million of sales in the first quarter of 2010 Because in 2011 wiped out the the entire Ythe increased sales in 2011 went directly to additional variable costs in 2011, resulting in operating income for 2011. fixed costs in 2010, resulting in operating income during 2011. operating loss from 2010, with additional contribution margin resulting in operating income for 2011. The increased