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ger-business class ger-economy class business class -economy class 45 35 555 295

ger-business class ger-economy class business class -economy class 45 35 555 295

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Break-even sales and sales mix for a service company Turbulence Airline provides air transportation services between Los Angeles, California, and Kona, Hawaii. A single Los Angeles to Kona round-trip flight has the following operating statistics: Zero Fuel Flight crew salaries Airplane depreciation Variable cost per passenger-business class Variable cost per passenger-economy class 35 Round-trip ticket price-business class 555 295 Round-trip ticket price-economy class It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight. $14,735 11,286 5,329 45 a. Compute the break-even number of seats sold on a single round-trip flight for the overall company product, M. Assume that the overall product mix is 10% business class and 90% economy class tickets. Total number of seats at break-even X seats b. How many business class and economy class seats would be sold at the break-even point? Business class seats at break-even X seats Economy class seats at break-even X seats
Transcribed Image Text:Break-even sales and sales mix for a service company Turbulence Airline provides air transportation services between Los Angeles, California, and Kona, Hawaii. A single Los Angeles to Kona round-trip flight has the following operating statistics: Zero Fuel Flight crew salaries Airplane depreciation Variable cost per passenger-business class Variable cost per passenger-economy class 35 Round-trip ticket price-business class 555 295 Round-trip ticket price-economy class It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight. $14,735 11,286 5,329 45 a. Compute the break-even number of seats sold on a single round-trip flight for the overall company product, M. Assume that the overall product mix is 10% business class and 90% economy class tickets. Total number of seats at break-even X seats b. How many business class and economy class seats would be sold at the break-even point? Business class seats at break-even X seats Economy class seats at break-even X seats
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