Fun Time Cruise-line offers nightly dinner cruises departing from several cities on the eastern coast of the United States including Charleston, Baltimore, and Alexandria. Dinner cruise tickets sell for $50 per passenger. Fun-time Cruise-line's variable cost of providing the dinner is $30 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 20,000 monthly passengers. If Fun Time Cruise-line has a target operating income of $30,000 per month, how many dinner cruise tickets must the company sell? First, identify the formula, then compute the target sales in units. Contribution margin per unit

Contribution margin ratio

Fixed expenses

Operating income

Units sold

Variable expenses

Transcribed Image Text:

+ + = Target sales units 11 + + = Target sales units 11

Answer rating: 100% (QA)

Formula Fixed cost Target incomeContribution per unit Target sales Contribution Sa... View the full answer