Chapter 21, Problem P21.62BPGB

To determine

Break-even point: The break-even point is the point where the total sales revenue is equal to the total costs involved in the production.

At a point where, there is no profit or loss, it is termed as break-even point.

Break-even point –

Total sales revenue = Total Variable cost + Total Fixed Cost

Target profit and Target Sales: Target sales referred to the sales which a firm aims in order to need to make a target profit.

Requirement 1

To determine:

Compute revenue and variable costs for each show

To determine

Requirement 2:

To determine:

The break-even in number of shows using the equation approach.

To determine

Requirement 3:

To determine:

Number of shows to earn a profit of $ 4,264,000

To determine

Requirement 4:

To prepare:

Income statement using Variable costing