Wildlife Escapes generates average revenue of $9,200 per person on its five-day package tours to wildlife parks in Kenya. The variable costs per person are

Airfare .............. $3,500

Hotel accommodations.... 1,200

Meals............. 480

Ground transportation ....... 920

Park tickets and other costs..... 240

Annual fixed costs total ........$1,287,000

REQUIRED

1. Calculate the number of package tours that must be sold to break even.

2. Calculate the revenue needed to earn a target operating income of $214,500.

3. If fixed costs increase by $40,500, what decrease in variable costs must be achieved to maintain the breakeven point calculated in requirement 1?