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Bright Travel Agency specializes in flights between Toronto and Jamaica. It books passengers on Georgetown Air. Bright's fixed costs are $28,500 per month. Georgetown Air
Bright Travel Agency specializes in flights between Toronto and Jamaica. It books passengers on Georgetown Air. Bright's fixed costs are $28,500 per month. Georgetown Air charges passengers $1,100 per round-trip ticket. Read the requirement. Begin by selecting the formula to calculate the breakeven points. Breakeven number of units = Next, select the formula to calculate the number of tickets needed to meet the target operating income. Quantity of units required to be sold =( Now complete the requirement for each of the cases. Begin with case 1. Case 1: Bright's variable costs are $36 per ticket. Georgetown Air pays Bright 6% commission on ticket price. Bright must sell tickets to break even and tickets to meet the target operating income Case 2: Bright's variable costs are $28 per ticket. Georgetown Air pays Bright 6% commission on ticket price. Bright must sell tickets to break even and tickets to meet the target operating income Case 3: Bright's variable costs are $28 per ticket. Georgetown Air pays $47 fixed commission per ticket to Bright. Comment on the results. Bright must sell tickets to break even and D t ickets to meet the target operating income. When comparing Case 3 to Case 2, the commission sizably the breakeven point and the number of tickets required to yield a target operating income of $16,000. Case 4: Bright's variable costs are $28 per ticket. It receives $47 commission per ticket from Georgetown Air. It charges its customers a delivery fee of $6 per ticket. Comment on the results. Bright must sell tickets to break even and tickets to meet the target operating income. When comparing Case 4 to Case 3, the $6 delivery fee results in a contribution margin which V both the breakeven point and the number of tickets sold to attain operating income of $16,000
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