Question
Tour Jamaica operates as a contracted grounds transportation facility based in Port Royal. The firm has a fleet of buses that takes visitors from the
Tour Jamaica operates as a contracted grounds transportation facility based in Port Royal. The firm has a fleet of buses that takes visitors from the Port Royal Pier to various local attractions across Kingston, St Andrew, and St Catherine. In the contractual arrangement, the firm pays an annual license fee in order to access the Pier, and also pays a fee to the Pier for each visitor that is picked up
The following data relates to the number of passengers moved over a six months period and the charged by the Pier :
| MONTH | # OF GUESTS | TOTAL CHARGE |
| May | 10,000 | $40,000 |
| June | 20,000 | $54,000 |
| July | 30,000 | $80,000 |
| August | 40,000 | $100,000 |
| September | 50,000 | $128,000 |
| October | 60,000 | $140,000 |
Required :
a. Plot the data above on a scatter graph and draw the line of best fit
b. Use the scatter graph to derive the fixed cost, variable cost, and hence the total cost
formula
c. Determine the amount to be charged in November if a total of 72,000 passengers
were to be expected
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Interpreting and Analyzing Financial Statements
Authors: Karen P. Schoenebeck, Mark P. Holtzman
6th edition
978-0132746243
