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Please process the attached document and return results. Thanks for your help! Intersection Driving School charges $300 per student to prepare and administer written and
Please process the attached document and return results.
Thanks for your help!
Intersection Driving School charges $300 per student to prepare and administer written and driving tests. Variable costs of $150 per student include trainers' wages, study materials, and gasoline. Annual fixed costs of $82,500 include the training facility and fleet of cars. 1. For each of the following independent situations, calculate the contribution margin per unit and the breakeven point in units by first referring to the original data provided: a. Breakeven point with no change in information. b. Decrease sales price to $250 per student. c. Decrease variable costs to $135 per student. d. Decrease fixed costs to $75,000. 2. Compare the impact of changes in the sales price, variable costs, and fixed costs on the contribution margin per unit and the breakeven point in units. Requirement 1. For each of the following independent situations, calculate the contribution margin per unit and the breakeven point in units: Begin by showing the formula for contribution margin per unit and then enter the amounts to calculate the contribution margin per unit for each situation. ____________________ - (minus) ___________= CM per unit Situation A: _________________ - (minus) ______________ = CM per unit Situation B: _________________ - (minus) ______________ = CM per unit Situation C: _________________ - (minus) ______________ = CM per unit Situation D: _________________ - (minus) ______________ = CM per unit Now select the labels to show the formula for breakeven point in units and then enter the amounts to calculate the breakeven point in units for each situation ( ___________ + ____________ ) / ___________ = Required Sales in Units Situation a. ( __________ + __________ ) / _________ = Required Sales in Units Situation b. ( __________ + __________ ) / _________ = Required Sales in Units Situation c. ( __________ + __________ ) / _________ = Required Sales in Units Situation c. ( __________ + __________ ) / _________ = Required Sales in Units Requirement 2. Compare the impact of changes in the sales price, variable costs, and fixed costs on the contribution margin per unit and the breakeven point in units. First, compare the impact of changes in the sales price, variable costs, and fixed costs on the contribution margin per unit. The contribution margin (decreases, does not change, increases) when the sales price decreases. The contribution margin (decreases, does not change, increases) when variable costs decrease. The contribution margin (decreases, does not change, increases) when the fixed costs decrease. Now, compare the impact of changes in the sales price, variable costs, and fixed costs on the breakeven point in units. The breakeven point (decreases, does not change, increases) when the sales price decreases. The breakeven point (decreases, does not change, increases) when the variable costs decrease. The breakeven point (decreases, does not change, increases) when fixed costs decreaseStep by Step Solution
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