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ruslelena [56]
3 years ago
15

Funtime Park competes with Slide World by providing a variety of rides. Funtime sells tickets at $ 85 per person as a​ one-day e

ntrance fee. Variable costs are $ 17 per​ person, and fixed costs are $ 428,400 per month. Compute Funtime ​Park's contribution margin ratio. Carry your computation to two decimal places. Use the contribution margin ratio approach to determine the sales revenue Funtime Park needs to break even.
Perform a numerical proof to compute the contribution margin per unit.
Business
1 answer:
Molodets [167]3 years ago
4 0

Answer:

$531,000

Explanation:

For determining the contribution margin ratio, first we have the contribution margin per unit which is shown below:

Contribution margin per unit = Selling price per unit - Variable expense per unit

= $85 - $17

= $68

And, Contribution margin ratio = (Contribution margin per unit) ÷ (selling price per unit) × 100  

So, the Contribution margin ratio is

= ($68) ÷ (85) × 100

= 80%

Now the break even point in sales dollars is

= $428,400 ÷ 80%

= $531,000

We simply applied the formulas

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Answer:

$31,500

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Read 2 more answers
On January 1, Zeibart Company purchases equipment for $220,000. The equipment has an estimated useful life of 10 years and expec
Nataly_w [17]

Answer:

(1) $19,500

(2) $142,000

(3) $27,000

(4) $15,000

Explanation:

Depreciation is the systematic allocation of the cost of an asset to the p/l over the useful life of the asset. It may be computed as

Depreciation = (cost - salvage value)/useful life

Annual depreciation = ($220,000 - $25,000)/10

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4 years later

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= $220,000 - 4 * $19,500

= $220,000 - $78,000

= $142,000

If the asset is impaired

An asset is said to be impaired when the carrying amount is higher than recoverable amount where the recoverable amount is the higher of the fair value less cost to sell or the value in use of the asset which is the present value of the future expected inflow from the use of the asset.

Value in use = $115,000

Fair value = $85,000

Value in use = $115,000

Impairment loss = $142,000 - $115,000

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Remaining number of years is 6

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The four different market structures determine profitability.

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Profitability is measured in terms of income and expenses. Income is the money generated by a company's activities. For example, if you produce and sell crops or livestock, income will be generated. However, the money that flows into the business, such as borrowing money, is not income.

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