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Spencer Kars provides shuttle service between four hotels near a medical center and an international airport. Spencer Kars uses two 10-passenger vans to offer 12
Spencer Kars provides shuttle service between four hotels near a medical center and an international airport. Spencer Kars uses two 10-passenger vans to offer 12 round trips per day. A recent months activity in the form of a cost-volume-profit income statement is shown below.
Fare revenues ( 1,500 fares) | $ 36,000 | |||
Variable costs | ||||
Fuel | $ 5,040 | |||
Tolls and parking | 3,100 | |||
Maintenance | 860 | 9,000 | ||
Contribution margin | 27,000 | |||
Fixed costs | ||||
Salaries | 15,700 | |||
Depreciation | 1,300 | |||
Insurance | 1,000 | 18,000 | ||
Net income | $ 9,000 |
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