Karaoke Enterprises operates in an entertainment industry in Kenya. The Company is analyzing the viability of...
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Karaoke Enterprises operates in an entertainment industry in Kenya. The Company is analyzing the viability of a concert it intends to hold in Nairobi, at an estimated fixed cost of Kshs 6,000,000; which includes the fees paid to performers, the hire of the venue and advertising costs. Variable costs consists of the cost pre-packed meals which will be provided by a catering firm at a negotiated price of Kshs 1,000 for every ticket sold. The tickets are proposed to be sold at Kshs 2.000. As a management accountant, the management has requested you for the following information: (a) The number of the tickets that must be sold to break even. (b) The number of tickets that must be sold to earn Ksh 3,000,000 (c) The profit that would be generated if 8,000 tickets were sold. (d) The selling price that would have to be charged to give a profit 3,000,000 on sale of 8,000 tickets. (3 marks) target profit. (3 marks) (3 marks) of Kshs (3 marks) (e) The additional tickets that must be sold to cover extra cost of advertising of Kshs 800,000. (3 marks) Karaoke Enterprises operates in an entertainment industry in Kenya. The Company is analyzing the viability of a concert it intends to hold in Nairobi, at an estimated fixed cost of Kshs 6,000,000; which includes the fees paid to performers, the hire of the venue and advertising costs. Variable costs consists of the cost pre-packed meals which will be provided by a catering firm at a negotiated price of Kshs 1,000 for every ticket sold. The tickets are proposed to be sold at Kshs 2.000. As a management accountant, the management has requested you for the following information: (a) The number of the tickets that must be sold to break even. (b) The number of tickets that must be sold to earn Ksh 3,000,000 (c) The profit that would be generated if 8,000 tickets were sold. (d) The selling price that would have to be charged to give a profit 3,000,000 on sale of 8,000 tickets. (3 marks) target profit. (3 marks) (3 marks) of Kshs (3 marks) (e) The additional tickets that must be sold to cover extra cost of advertising of Kshs 800,000. (3 marks)
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The detailed answer for the above question is provided below a The breakeven point BEP is the point ... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0176509736
10th Canadian Edition, Volume 1
Authors: Donald Kieso, Jerry Weygandt, Terry Warfield, Nicola Young,
Posted Date:
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