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Suppose Ocean Cruiseline decides to offer two types of dinner cruises: regular cruises and executive cruises. The executive cruise includes complimentary cocktails and a five-course
Suppose Ocean Cruiseline decides to offer two types of dinner cruises: regular cruises and executive cruises. The executive cruise includes complimentary cocktails and a five-course dinner on the upper deck. Assume that fixed expenses remain at $210,000 per month and that the following ticket prices and variable expenses apply Executive Cruise Regular Cruise 50 $ 100 Sale price per ticket. Variable expense per passenger 20 40 Assume that in the month of April, Ocean Cruiseline sold 7,000 regular cruises and 3,900 executive cruises and that $82,000 of the fixed costs are traceable to regular cruises while $90,000 of the fixed costs are traceable to executive cruises. Prepare a segmented income statement using the contribution margin format Prepare a segmented income statement using the contribution margin format. Ocean Cruiseline Income Statement (Segmented) Month Ended April 30 Regular Executive Total Units Revenues Variable expenses Contribution margin Traceable fixed expenses Segment margin Common costs Net income
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