Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

reak-even number of passengers for a cruise Ocean Escape Cruise Lines has a boat with a capacity of 1,200 passengers. An eight-day ocean cruise involves

reak-even number of passengers for a cruise

Ocean Escape Cruise Lines has a boat with a capacity of 1,200 passengers. An eight-day ocean cruise involves the following costs:

Crew$240,000Fuel60,000Fixed operating costs800,000The variable costs per passenger for the eight-day cruise include the following:

Meals$900Variable operating costs400The price of the cruise is $2,400 per passenger.

a.Determine the break-even number of passengers for the eight-day cruise.

b.Assume 900 passengers booked the cruise. What would be the profit or loss for the cruise?

$

c.Assume the cruise was booked to capacity. What would be the profit or loss for the cruise?

$

d.If the cruise cannot book enough passengers to break even, how might the cruise line respond?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

College Accounting Chapters 1-9

Authors: James Heintz

22nd Edition

1305888537, 978-1305666184

More Books

Students also viewed these Accounting questions

Question

98. For a compound random variable S = N i=1 Xi , find Cov(N, S).

Answered: 1 week ago

Question

FACTORS AND RISKS AUDIT FIRM CONSIDERS WHEN ACCEPTING A NEW CLIENT

Answered: 1 week ago