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The Soma Inn is trying to determine its break-even point. The inn has 75 rooms that are rented at $52 a night. Operating costs are
The Soma Inn is trying to determine its break-even point. The inn has 75 rooms that are rented at $52 a night. Operating costs are as follows. Salaries 58,800 per month Utilities 2,500 per month Depreciation 1.500 per month Maintenance 750 per month Maid service 7 per room Other costs 32 per room Determine the inn's break-even point in (1) number rented rooms per month and (2) dollars. 1. Break-even point in rooms 2. Break-even point per month $ LINK TO TEXT If the inn plans on renting an average of 50 rooms per day (assuming a 30-day month), what is (1) the monthly margin of safety in dollars and (2) the margin of safety ratio? (Round ratio o decimal places, e.g. 10%.) 1. Margin of safety 2. Margin of safety ratio Click if you would like to Show Work for this question: Open Show Work Barnes Company reports the following operating results for the month of August: sales $315,000 (units 5,000); variable costs $218,000; and fixed costs $70,000. Management is considering the following independent courses of action to increase net income. Compute the net income to be earned under each alternative 1. Increase selling price by 10% with no change in total variable costs or sales volume. Net income $ 2. Reduce variable costs to 60% of sales. Net income $ 3. Reduce fixed costs by $23,000. Net income Which course of action will produce the highest net income? Click if you would like to Show Work for this question: Open Show Work
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