Magnon Carriage Company offers guided horse-drawn carriage rides through historic Edmonton. The carriage business is highly regulated by the city. Magnon Carriage Company has the following operating costs during April: (Click the icon to view the operating costs.) During April (a month during peak season) Magnon Carriage Company had 13,600 passengers. 75% of passengers were adults ($23 fare) while 25% were children ($15 fare). Requirements 1. Prepare the company's contribution margin income statement for the month of April. Round all final figures to the nearest dollar 2. Assume that passenger volume increases by 20% in May. Which figures on the income statement would you expect to change, and by what percentage would they change? Which figures would remain the same as in April? 0 Data Table $ 2,300 20% of ticket revenue $0.95/set of postcards Monthly depreciation expense on carriages and stable Fee paid to Quebec City ......... Cost of souvenir set of postcards given to each passenger ......... Brokerage fee paid to independent ticket brokers (60% of tickets are issued through these brokers; 40% are sold directly by the Magnon Carriage Company) ....... Monthly cost of leasing and boarding the horses..... Carriage drivers (tour guides) are paid on a per-passenger basis ...................... Monthly payroll costs of non-tour-guide employees Marketing, website, telephone, and other monthly fixed costs ........ $1.80/ticket sold by broker $ 52,000 $3.20 per passenger $ 8,300 $ 7,600 Print Done Magnon Carriage Company Contribution Margin Income Statement For the Month Ended April 30 Operating income would Requirement 2. Assume passenger volume increases by 20% in May. Which gures on the income statement would you expect to change and by what percentage would they change? If passenger volume increases by 20% in May, we would expect few fed expenses to decrease by 20%. This is because feed costs change in direct proportion to changes in volume. As a result, the feed expenses decrease by 2016 Which figures would remain the same as in April Assuming that a 20% increase in volume is still in the same relevant range, we would expect most med costs to remain at their present level