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Sunny Spot Travel Agency specializes in flights between Toronto and Jamaica. It books passengers on Ottawa Air. Sunny Spot's fixed costs are $25,500 per month.
Sunny Spot Travel Agency specializes in flights between Toronto and Jamaica. It books passengers on Ottawa Air. Sunny Spot's fixed costs are $25,500 per month. Ottawa Air charges passengers $1,400 per round-trip ticket. Read the requirement. Begin by selecting the formula to calculate the breakeven points. Breakeven number of units Fixed costs Contribution margin per unit Next, select the formula to calculate the number of tickets needed to meet the target operating income. Quantity of units required to be sold =( + 0 Requirement -X Calculate the number of tickets Sunny Spot must sell each month to (a) break even and (b) make a target operating income of $19,000 per month in each of the following independent cases. (Round up to the nearest whole number. For example, 10.2 should be rounded up to 11.) 1. Sunny Spot's variable costs are $40 per ticket. Ottawa Air pays Sunny Spot 10% commission on ticket price. 2. Sunny Spot's variable costs are $38 per ticket. Ottawa Air pays Sunny Spot 10% commission on ticket price. 3. Sunny Spot's variable costs are $38 per ticket. Ottawa Air pays $55 fixed commission per ticket to Sunny Spot. Comment on the results. 4. Sunny Spot's variable costs are $38 per ticket. It receives $55 commission per ticket from Ottawa Air. It charges its customers a delivery fee of $8 per ticket. Comment on the results
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