Ocean Cruiseline offers nightly dinner cruises departing from several cities on the eastern coast of the...
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Ocean 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 $50 per passenger. Ocean Cruiseline's variable cost of providing the dinner is $20 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $270,000 per month. The company's relevant range extends to 15,000 monthly passengers. The breakeven sales are 9,000 tickets sold. a. Compute the operating leverage factor when Ocean Cruiseline sells 12,000 dinner cruises. b. If volume increases by 9%, by what percentage will operating income increase? c. If volume decreases by 2%, by what percentage will operating income decrease? a. Compute the operating leverage factor when Ocean Cruiseline sells 12,000 dinner cruises. (Round your answer to one decimal place.) First, identify the formula, then compute the operating leverage factor Operating leverage factor Ocean 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 $50 per passenger. Ocean Cruiseline's variable cost of providing the dinner is $20 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $270,000 per month. The company's relevant range extends to 15,000 monthly passengers. The breakeven sales are 9,000 tickets sold. a. Compute the operating leverage factor when Ocean Cruiseline sells 12,000 dinner cruises. b. If volume increases by 9%, by what percentage will operating income increase? c. If volume decreases by 2%, by what percentage will operating income decrease? a. Compute the operating leverage factor when Ocean Cruiseline sells 12,000 dinner cruises. (Round your answer to one decimal place.) First, identify the formula, then compute the operating leverage factor Operating leverage factor
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