Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Super Crilgoline offers nightly dinner crulses depaiting from several cities on the East Coast of the United States including Charlesfon. Baltimore, and Alexandria Dinner crulse

image text in transcribed
Super Crilgoline offers nightly dinner crulses depaiting from several cities on the East Coast of the United States including Charlesfon. Baltimore, and Alexandria Dinner crulse tckets sell for 550 per passenger. Super Crulseline's variable cost of providing the dinnet is 520 per passenger, and the fixed cost of operating the vessels (depreciation, balaries, docking fees, and other expenses) is $270,000 per month. Under thebe conditions, the breakeveri point in fickets is 9.000 and the breakeven point in sales dollars is 5450,000 . Suppose Super Cruiseline embarks on a cost reduction drwe and slashes fixed expenses from 5270 . 600 per month to $255,000 per month. Reyd the 1. Compute the new breakeven point in units and in sales dollars. Begin with the breakeven point units. Enter the formula, then compute the breakeven point (For amounts with a 50 balance, make sure to enter "0" in the appropiate inpet field) Now compute the breakeven point in sales dollars. Enter the formula, then compute the breakeven point (Enter the contribution margin ratio as a whole percent For amounts with a 50 balance, make sure to enter "0" In the appropriate input field) - Breakeven units 2. Is the breakeven point higher or lower than under the original conditions? Explain how changes in fixed costs generally affect the breakeven point. The breakeven point is All else being equal, in foxed costs will decrease the breakeven point while in foxed costs will increase the breakeven point

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

Step: 3

blur-text-image

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

The Internet Market Research Audit

Authors: Cambridge

1st Edition

1902433742, 978-1902433745

More Books

Students also viewed these Accounting questions

Question

Why should Christians care about philosophy?

Answered: 1 week ago

Question

error bar charts

Answered: 1 week ago