Use this information to compute the following:a. What is the contribution margin per passenger?b. What is the contribution margin ratio?c. Use the unit contribution margin to project operating income if monthly sales total 10,000 passengers.d. Use the contribution margin ratio to project operating income if monthly sales revenue totals $490,000. Flow Cruiseline offers nightly dinner cruises departing from several cities on the eastern coast of the United Statesincluding Charleston, Baltimore, and Alexandria. Dinner cruise tickets sell for $50 per passenger. Flow Cruiseline'svariable cost of providing the dinner is $20 per passenger, and the fixed cost of operating the vessels(depreciation, salaries, docking fees, and other expenses) is $210,000 per month. The company's relevant rangeextends to 13,000 monthly passengers.d.

given that, selling price per ticket = $50 variable cost per ticket = $20 fixed cost = $210000…

Use this information to compute the following: a. What is the contribution margin per passenger? b. What is the contribution margin ratio? c. Use the unit contribution margin to project operating income if monthly sales total 10,000 passengers. d. Use the contribution margin ratio to project operating income if monthly sales revenue totals $490,000.

Use this information to compute the following: a. What is the contribution margin per passenger? b. What is the contribution margin ratio? c. Use the unit contribution margin to project operating income if monthly sales total 10,000 passengers. d. Use the contribution margin ratio to project operating income if monthly sales revenue totals $490,000.

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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1. To compute the breakeven point using the contribution margin, we get the ratio of a. Total fixed expenses and Total contribution margin b. Total variable expenses and Total Contribution margin c. Total fixed expenses and Contribution margin per unit d. Total variable expenses and Contribution margin per unit 2. A mathematical expression that describes a breakeven point of a company is a. Sales Revenue = Variable expenses + Fixed expenses b. Sales Revenue = Variable expenses - Fixed expenses c. Sales Revenue < Variable expenses + Fixed expenses d. Sales Revenue > Variable expenses - Fixed expenses 3. The Cost-Volume-Profit equation is given by a. Sales Revenue = Profits + Contribution margin ratio + Fixed expenses b. Sales Revenue = Profits + Contribution margin + Fixed expenses c. Sales Revenue = Profits+ Variable expenses + Fixed expenses d. Sales Revenue = Profits -Variable expenses…
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