Questions -

Q1. Durango sells its product for $48. Its variable cost per unit is $40.

a. If fixed cost total is $8,000, how many unit must the company sell to break even? What are total sales in dollars at the breakeven point?

b. if fixed cost is $12,000, how many units does the company need to sell to break even? What are total sales in dollar at the breakeven point?

c. if fixed costs total $20,000, how many units must the company sell to break even? What are the total sales in dollars at the breakeven point?

Q2. The ice city blade are a minor league ice hockey franchise, their arena has 5,000 seats, all of which sells for $11 per ticket per game. The team plays 40 home games and expects to average 70 percent attendance at each game. Variable cost related to ticket printing, promotions, and mailings are estimated to be $1 per ticket. Fixed cost including salaries and operating expenses total $1.2 million for the season.

a. What are the expected total sales in dollars and units (ticket)?

b. What would total sales be if the team sold every ticket to every game?

c. What is the teams projected net income and its planned sales level?

d. What is the breakeven point in terms of total tickets sold?

e. How many tickets per game on average does the team need to sell to break even?

f. Compute the teams safety margin in sales dollars and units (tickets)?

Q3. Heart & Soul vintage vinyl record emporium provided the following information:

Average selling price per record $15

Average variable cost per record: $10

Monthly fixed cost: $10, 000

Compute the following:

a. What is heart & soul's contribution margin per unit in dollars?