Question 1
	Revenue	Variable	Contribution
		Costs	Margin
Room	4,000,000	800,000	3,200,000
Food	1,200,000	1,050,000	150,000
Beverage	600,000	350,000	250,000
Telephone	200,000	200,000	-
Total	6,000,000	2,400,000	3,600,000
Fixed Costs			3,300,000
Income Tax			60,000
Net Income			240,000
Required:
1. Average contribution margin ratio = 3.6 / 6.0 = 60%
2. Calculate Breakeven point = TFC / CMR ==> 3.3 / 60% = 5,500,000
3. Total revenue to earn a net income of $500,000
4. Rooms revenues when net income = $500,000
5. Breakeven point if fixed costs increase by $300,000