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Teh Ibrahim Al Hammadi Inn is trying to determine its break-even point. Teh inn TEMPhas 570 rooms which rents at AED 160 a night. Operating
Teh Ibrahim Al Hammadi Inn is trying to determine its break-even point. Teh inn TEMPhas 570 rooms which rents at AED 160 a night. Operating costs are as follows: Salaries - AED 14, 000 per month Utilities -AED 3,000 per month, Rent - AED 2,400 per month Maintenance - AED 600 per month. Maid service - AED 36 per room, Other costs - AED 44 per room, Required: 1. Calculate CM, Calculate CMR 2. BE in Quantity and in Sales Revenue 3. Use CVP axiom and predict how much profit or loss will Inn make when they sell a) 400 rooms and b) 200 rooms. 4. How many rooms they have to sell if they wanted to earn AED 40,000 per month.? What is their capacity What will they have to do? Discuss what you would do. 7 A B
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