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Question 1 Jane Botosan operates a bed and breakfast hotel in a resort area near Lake Michigan. Depreciation on the hotel is $60,000 per year.

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Question 1 Jane Botosan operates a bed and breakfast hotel in a resort area near Lake Michigan. Depreciation on the hotel is $60,000 per year. Jane employs a maintenance person at an annual salary of $41,000 and a cleaning person at an annual salary of $24,000. Real estate taxes are $10,.000 per year. The rooms rent at an average price of $60 per person per night including breakfast.Other costs are laundry and cleaning service at a cost of $10 per person per night and the cost of food which is $5 per person per night. Determine the number of rentals and the sales revenue Jane needs to break even using the contribution margin technique Break-even number of rentals Break-even sales 180000 If the current level of rentals is 4,000, by what percentage can rentals decrease before Jane has to worry about having a net loss? Margin of safety Jane is considering upgrading the breakfast service to attract more business and increase prices. This will cost an additional $3 for food costs per person per night. Jane feels she can increase the room rate to $68 per person per night.Determine the number of rentals and the sales revenue Jane needs to break evenif the changes are made Break-even number of rentals Break-even sales

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