A 90-room motel has an average room rate of $65.60. Its fixed costs are $300,000 a year,

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A 90-room motel has an average room rate of $65.60. Its fixed costs are $300,000 a year, and its variable costs total $476,000 at an average occupancy of 70 percent.

a. What is the motel’s breakeven occupancy percentage?

b. What level of sales revenue is required to provide an operating income (before taxes) of $100,000 a year?

Related Book For answer-question

Cost Accounting Foundations and Evolutions

ISBN: 978-1111971724

9th edition

Authors: Michael R. Kinney, Cecily A. Raiborn

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Posted Date: Jun 11, 2022 12:57 AM

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A 90-room motel has an average room rate of $65.60. Its fixed costs are $300,000 a year,

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a b C d e f g h i j k 1 j k 3 No of rooms 90 Fixed co... View the full answer

Cost Accounting Foundations and Evolutions

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