Question

Use the information from the Crystal Cruiseline Data Set. Suppose Crystal Cruiseline ­embarks on a cost reduction drive and slashes fixed expenses from $ 210,000 per month to $ 180,000 per month.
1. Compute the new breakeven point in units and in sales dollars.
2. Is the breakeven point higher or lower than in S7- 3? Explain how changes in fixed costs generally affect the breakeven point. Cost- Volume-

Crystal Cruiseline Data
Crystal Cruiseline offers nightly dinner cruises off the coast of Miami, San Francisco, and Seattle. Dinner cruise tickets sell for $ 50 per passenger. Crystal Cruiseline’s variable 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 range extends to 14,000 monthly passengers.



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  • CreatedAugust 27, 2014
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