GC Hotel Holding Company has 2 hotel chains: a luxury chain and a economy chain. The luxury
Fantastic news! We've Found the answer you've been seeking!
Question:
GC Hotel Holding Company has 2 hotel chains: a luxury chain and a economy chain. The luxury chain represents 60% of its revenue, and provides a contribution margin ratio of 30%. The economy chain provides 40% of its revenue, and provides a 45% contribution margin ratio. The company's fixed costs are $8,100,000
- What is the weighted average contribution margin ratio?
- What is the breakeven sales in dollars?
- To achieve breakeven for the company, what is the revenue the luxury chain must achieve?
- To achieve breakeven for the company, what is the revenue the economy chain must achieve?
- If the company has a desired income of $1,800,000, what amount of revenue would CG Hotel Holding Company earn from the economy chain if they achieve this goal with the current sales mix?
Related Book For
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins
Posted Date: