Respuesta :
Answer:
a. Average selling price per unit = $30
b. Average variable cost = $16
c. Average Contribution margin per ticket = $14
d. Break Even Point = 46,600 Tickets
e. For profit of $306,600 = 68,500 tickets
Explanation:
As for the provided information we have,
a. Average selling price per unit = [tex]\frac{Total\ Sales\ Revenue}{Number\ of\ Units}[/tex]
Provided total sales revenue = $1,980,000
Number of units = $66,000
Thus, average selling price = [tex]\frac{1,980,000}{66,000} = 30[/tex] = $30 per unit.
b. Average variable cost = [tex]\frac{Total\ variable\ cost}{Number\ of\ units}[/tex]
Provided total variable cost = $1,056,000
Number of units = $66,000
Thus, average variable cost per unit = [tex]\frac{1,056,000}{66,000} = 16[/tex] = $16 per unit
c. Average Contribution margin per ticket = Average selling price per ticket - Average variable cost per ticket = $30 - $16 = $14 per unit.
Alternatively it can be calculated as [tex]\frac{Total\ sales - Total\ variable\ cost}{Number\ of\ units}[/tex] = [tex]\frac{1,980,000 - 1,056,000}{66,000} = 14[/tex]
d. Break Even Point = [tex]\frac{Fixed\ Cost}{Contribution\ per\ unit}[/tex]
Fixed cost = $652,400
Contribution per unit = $14 per unit
Break even point = [tex]\frac{652,400}{14} = 46,600[/tex] = 46,600 Tickets
e. In this case desired profit = $306,600
Fixed cost = $652,400
Total amount to be recovered through contribution = $306,600 + $652,400 = $959,000
Thus, number of tickets to be sold = [tex]\frac{959,000}{14} = 68,500[/tex]
That is 68,500 tickets.
