Camp Rainbow offers overnight summer camp programs for children ages 10 to 14 every summer during...

 

Transcribed Image Text:

Camp Rainbow offers overnight summer camp programs for children ages 10 to 14 every summer during June and July. Each camp session is one week and can accommodate up to 200 children. The camp is not coed, so boys attend during the odd-numbered weeks and girls attend during the even-numbered weeks. While at the camp, participants make crafts, participate in various sports, help care for the camp's resident animals, have cookouts and hayrides, and help assemble toys for local underprivileged children. The camp provides all food as well as materials for all craft classes and the toys to be assembled. One cabin can accommodate up to 10 children, and one camp counselor is assigned to each cabin. Three camp managers are on-site regardless of the number of campers enrolled. Following is the cost information for Camp Rainbow's operations last summer: Week Number of Campers 90 Cost to Run. Camp 12345678 $ 8,050 118 8,460 156 10,900 174 11,100 188 13,685 184 14,300 170 12,325 156 11,270 E5-16 (Static) Prexaring Contribution Margin Income Statement [LO 5-5] Intercept X Variable 1 Coefficients 1868.85 60.79 Suppose that Rainbow is contemplating staying open one additional week during the summer. Required: 1. Using the results of the least-squares regression analysis, determine Rainbow's contribution margin per camper if each camper pays $175 to attend the camp for a week. 2. Using the results of the least-squares regression analysis, prepare a contribution margin income statement for week 9 assuming Rainbow expects to have 170 campers that week. 3. Should Rainbow add a ninth week to its schedule? Camp Rainbow offers overnight summer camp programs for children ages 10 to 14 every summer during June and July. Each camp session is one week and can accommodate up to 200 children. The camp is not coed, so boys attend during the odd-numbered weeks and girls attend during the even-numbered weeks. While at the camp, participants make crafts, participate in various sports, help care for the camp's resident animals, have cookouts and hayrides, and help assemble toys for local underprivileged children. The camp provides all food as well as materials for all craft classes and the toys to be assembled. One cabin can accommodate up to 10 children, and one camp counselor is assigned to each cabin. Three camp managers are on-site regardless of the number of campers enrolled. Following is the cost information for Camp Rainbow's operations last summer: Week Number of Campers 90 Cost to Run. Camp 12345678 $ 8,050 118 8,460 156 10,900 174 11,100 188 13,685 184 14,300 170 12,325 156 11,270 E5-16 (Static) Prexaring Contribution Margin Income Statement [LO 5-5] Intercept X Variable 1 Coefficients 1868.85 60.79 Suppose that Rainbow is contemplating staying open one additional week during the summer. Required: 1. Using the results of the least-squares regression analysis, determine Rainbow's contribution margin per camper if each camper pays $175 to attend the camp for a week. 2. Using the results of the least-squares regression analysis, prepare a contribution margin income statement for week 9 assuming Rainbow expects to have 170 campers that week. 3. Should Rainbow add a ninth week to its schedule?