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TransPacific Airlines (TPA) budgeted 155 million passenger miles, or 5% of the total market for the year just completed, at a contribution margin of 115
TransPacific Airlines (TPA) budgeted 155 million passenger miles, or 5% of the total market for the year just completed, at a contribution margin of 115 cents per mile. The budgeted average price was 127 cents per passenger mile. The operating data for the year show that TPA flew 133.92 million passenger miles with an average price of 78 cents per passenger mile. The terrorist activity in the early part of the year in several countries in the region decreased the total miles flown by all airlines for the year by 10%. There is no flexible-budget variance for all costs. Required: 1. In an effort to understand the operating results, you are asked to compute the following. (Do not round intermediate calculations. Enter your answers in whole dollars.)
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