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TOPIC SEVEN-COST MANAGEMENT IN HOTELS (11 marks) Question Four Hot Resorts Ltd offers two types of accommodation-motel and hotel Data conceming the accommodation is listed
TOPIC SEVEN-COST MANAGEMENT IN HOTELS (11 marks) Question Four Hot Resorts Ltd offers two types of accommodation-motel and hotel Data conceming the accommodation is listed below Selling price per unit Variable expenses per unt Contribution margin per unit Motel $100 60 Hotel $120 In the month of September, Hot Resorts Ltd sold 400 motel units and 600 hotel units. Fxed expenses are $50,000 per month Required A Prepare a contributon margin income statement for the month of September for each form of accommodation B Calculate the company's overall monthly break-even point in sales dollars C If the company continues to sell 1,000 units, in total, each month, but the sales mix shits so that an equal number of units of each type of accommodation is being sold, would you expect monthly net income to rise or fail? Explain. Refer to the data in part C. above. If the sales mix shits as explained, would you expect the compan's monthly break-even point to rise or fal? Explain. D
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