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Northampton City Tours (NCT) offers personalized historical and architectural tours in a large midwestern city and the local suburbs. NCT charges $364.00 per trip to or from the airport. The variable cost for a tour totals $49.00, for fuel, driver, and so on. The monthly fixed cost for NCT is $19, 845. Required: How many tours must NCT sell every month to break even? NCT's owners believe that 70 tours is a reasonable forecast of the average monthly demand. What is the margin of safety in terms of the number of tours? Note: Round your answer to the nearest whole number.

Northampton City Tours (NCT) offers personalized historical and architectural tours in a large midwestern city and the local suburbs. NCT charges $364.00 per trip to or from the airport. The variable cost for a tour totals $49.00, for fuel, driver, and so on. The monthly fixed cost for NCT is $19, 845. Required: How many tours must NCT sell every month to break even? NCT's owners believe that 70 tours is a reasonable forecast of the average monthly demand. What is the margin of safety in terms of the number of tours? Note: Round your answer to the nearest whole number.

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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Northampton City Tours (NCT) offers personalized historical and architectural tours in a large midwestern city and the local suburbs. NCT charges $364.00 per trip to or from the airport. The variable cost for a tour totals $49.00, for fuel, driver, and so on. The monthly fixed cost for NCT is $19,845. Required: How many tours must NCT sell every month to break even? NCT's owners believe that 70 tours is a reasonable forecast of the average monthly demand. What is the margin of safety in terms of the number of tours? Note: Round your answer to the nearest whole number.
Transcribed Image Text:Northampton City Tours (NCT) offers personalized historical and architectural tours in a large midwestern city and the local suburbs. NCT charges $364.00 per trip to or from the airport. The variable cost for a tour totals $49.00, for fuel, driver, and so on. The monthly fixed cost for NCT is $19,845. Required: How many tours must NCT sell every month to break even? NCT's owners believe that 70 tours is a reasonable forecast of the average monthly demand. What is the margin of safety in terms of the number of tours? Note: Round your answer to the nearest whole number.
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