The Sandhill Acres Inn is trying to determine its break-even point during its off - peak season. The inn has 50 rooms that it rents at $60 a night. Operating costs are as follows: Salaries $8,000 per month Property tax $1,400 per month Depreciation (straight-line) $1,000 per month Maintenance $250 per month Maid service $10 per room Other costs $ 20 per room a) Determine the inn's break-even point in number of rented rooms per month. b) Determine the inn's break-even point in sales dollars.

The Sandhill Acres Inn is trying to determine its break-even point during its off - peak season. The inn has 50 rooms that it rents at $60 a night. Operating costs are as follows: Salaries $8,000 per month Property tax $1,400 per month Depreciation (straight-line) $1,000 per month Maintenance $250 per month Maid service $10 per room Other costs $ 20 per room a) Determine the inn's break-even point in number of rented rooms per month. b) Determine the inn's break-even point in sales dollars.

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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