Question
Wildhorseprovides shuttle service between 4 hotels near a medical center and an international airport.Wildhorseuses two 10-passenger vans to offer 12 round trips per day. A
Wildhorseprovides shuttle service between 4 hotels near a medical center and an international airport.Wildhorseuses two 10-passenger vans to offer 12 round trips per day. A recent month's activity in the form of a cost-volume-profit income statement is as follows.
Sales (1,340passengers)$30,820Variable costsFuel$3,624Tolls and parking1,921Maintenance6196,164Contribution margin24,656Fixed costsSalaries13,300Depreciation (straight-line)1,900Insurance90016,100Net income$8,556
(a)
Calculate the break-even point in (1) sales dollars and (2) number of passengers.
Break-even point$
enter the break-even point in dollars
Break-even pointenter the break-even point in number of passengers
passengers
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(b)
Without calculations, determine the contribution margin at the break-even point.
Contribution margin at the break-even point$
enter the contribution margin at the break-even point in dollars
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