Question: get solution Dorothy Botosan operates a bed and breakfast hotel in a resort area near Lake Michigan. Depreciation on the hotel is $70,000 per year.
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Dorothy Botosan operates a bed and breakfast hotel in a resort area near Lake Michigan. Depreciation on the hotel is $70,000 per year. Dorothy employs a maintenance person at an annual salary of $51,000 and a cleaning person at an annual salary of $34,000. Real estate taxes are $20,000 per year. The rooms rent at an average price of $70.00 per person per night including breakfast. Other costs are laundry and cleaning service at a cost of $20.00 per person per night and the cost of food, which is $15.00 per person per night. (a) Determine the quantity of rentals and the sales revenue Dorothy needs to break even using the contribution margin technique. Break-even quantity of rentals Break-even sales $Step by Step Solution
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