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Whiskey-Jack Adventures offers guided tours and wilderness experiences in the mountains and lakes around Whistler, B.C. Whiskey-Jack provides a guide, all the necessary provisions, and
Whiskey-Jack Adventures offers guided tours and wilderness experiences in the mountains and lakes around Whistler, B.C. Whiskey-Jack provides a guide, all the necessary provisions, and equipment for a fee of $75 per person per day. Based on available equipment and guides, the maximum capacity is 800 tour-days per month (customers are taken on the equivalent of an all-day tour). The company is presently operating at a level of an average of 600 tour-days per month. Variable costs per tour-day for 20x1 were as follows: Food 5 7.50 Supplies 3.00 Guide's salary 37.50 Insurance 1200 $60.00 Annual xed costs for 20x1 were as follows: Equipment rental :5 7,500 Marketing 3,000 Customer service 1,500 Administration 6,000 $1 8,000 Required Answer the following questions independently of each other. a. Assuming that the fee is increased by $18.00 per person per day in 2002 and the number of tour-days declines by 200 per month, calculate the effect on the monthly operating income
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