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The City of Blakston owns and operates a community swimming pool. The pool is open each year for 90 days during the summer months of

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The City of Blakston owns and operates a community swimming pool. The pool is open each year for 90 days during the summer months of June, July, and August. A daily admission is charged to patrons of the pool. By law, 10 percent of all recreational and sporting fees must be remitted to a state tourism promotion fund. The city manager has set a goal that pool admission revenue, after subtracting the state fee and variable costs, must be sufficient to cover the fixed costs. Variable costs are assumed to be 15 percent of gross revenue. Fixed costs for the three-month period total $33,000. The following budget for the pool has been prepared for the current year: Adult admissions: 30 per day x 90 days * $5.00 Student admissions: 120 per day 90 days $2.50 $13,500 27,000 Total revenue 40,500 State tourism fee 4,050 Net revenue 36,450 Variable costs 6,075 Fixed costs 33,000 Expected deficit $(2.625) The city manager is trying to determine what admission mix is necessary to break even and what actions could be taken to eliminate the expected deficit. Use the above case and your course work to answer the following questions: analysis. the underlying assumption _.arysis: 3) Given the anticipated mix of adult and student submissions, how many total admissions must the pool have in order to breakeven for the season? 4) Regardless of the admission mix, what is the highest number of admissions that would be necessary to breakeven for the season? 5) How would you use the above information for decision making purposes

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