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Sandra Botosan operates a bed and breakfast hotel in a resort area near Lake Michigan. Depreciation on the hotel is $76,272 per year. Sandra employs
Sandra Botosan operates a bed and breakfast hotel in a resort area near Lake Michigan. Depreciation on the hotel is $76,272 per year. Sandra employs a maintenance person at an annual salary of $57,000 and a cleaning person at an anual salary of $40,000. Real estate taxes are $26,000 per year. The rooms rent at an average price of $76.00 per person per night including breakfast. Other costs are laundry and cleaning service at a cost of $26.12 per person per night and the cost of food, which is $21.00 per person per night. (a) Your answer has been saved. See score details after the due date. Determine the quantity of rentals and the sales revenue Sandra needs to break even using the contribution margin technique. Break-even quantity of rentals Break-even sales $ Attempts: 1 of 1 used (b) If the current level of rentals is 8,900 , by what percentage can rentals decrease before Sandra has to worry about having a net loss? (Round percentages to 0 decimal places, e.g. 52\%.) Margin of safety %
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