Comfi Airways, Inc., a small two-plane passenger airline, has asked for your assistance in some basic analysis of its operations. Both planes seat 10 passengers each, and they fly commuters from Comfi’s base airport to the major city in the state, Metropolis. Each month, 40 round-trip flights are made. Shown below is a recent month’s activity in the form of a cost-volume-profit income statement.

Fare revenues (400 passenger flights) $48,000

Variable costs

Fuel $15,040

Snacks and drinks 680

Landing fees 2,000

Supplies and forms 1,000 18,720

Contribution margin 29,280

Fixed costs Depreciation 2,950

Salaries 14,514

Advertising 500

Airport hanger fees 1,800 19,764

Net income $9,516

Calculate the break-even point in dollars. Break-even point

Calculate the break-even point in number of passenger flights. Break-even point

Without calculations, determine the contribution margin at the break-even point.

If ticket prices were decreased by 10%, passenger flights would increase by 25%. However, total variable costs would increase by the same percentage as passenger flights. (1) How much would net income be impacted by this change? Net income.