Question: 36. Fun Time, Inc. uses the same property and equipment to provide skiing services for 6 months during the winter and mountain roller boarding for
36. Fun Time, Inc. uses the same property and equipment to provide skiing services for 6 months during the winter and mountain roller boarding for six months during the summer.Monthly revenue and cost figures during the summer and winter months for Fun Time are shown below.Fun Time's monthly fixed costs will be incurred as long as it remains in business.
Winter MonthsSummer Months
Total Revenue$12,000$5,000
Operating (variable) costs($6,000)($5,200)
Fixed Costs($1,000)($1,000)
Net Revenue$5,000(-$1,200)
Fun time is trying to decide whether to: a) operate in just the winter months, or b) operate in both the summer and winter months, or
c) go out of business and shut down. Which option do you recommend?
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