Answer:
The fixed costs are too high. The marginal cost generally represents variable costs and they might be very low, but if the fixed costs are simply too high, they will need to increase the price of the plane tickets in order to break even. The break even formula is calculated by dividing total fixed costs by marginal revenue (selling price - variable costs).
Answer:
<em>Risk capital</em>
Explanation:
Risk capital <em>relates to funds allocated to risky operation and used to invest heavy-risk, elevated-reward.</em>
Diversification is key to a successful risk capital investment, because the prospects of each investment appear to be undetermined in nature, although the yields may be far above average when an investment is successful.
Answer:
Purchases= $57,530
Explanation:
Giving the following formula:
Production= 91,500*(1 - 0.18)= $75,030
Beginning inventory= $25,000
Desired ending inventory= $7,500
<u>To calculate the budgeted purchases, we need to use the following formula:</u>
<u></u>
Purchases= production + desired ending inventory - beginning inventory
Purchases= 75,030 + 7,500 - 25,000
Purchases= $57,530
Answer:
b. $311,600
Explanation:
For the computation of total contribution margin first we need to find out the contribution margin per unit which is shown below:-
Contribution Margin per Unit = Contribution Margin ÷ Units Sold
= 319,200 ÷ 8,400
= $38
Total Contribution Margin = Contribution Margin per Unit × Units Sold
= $38 × 8,200
= $311,600
Therefore for computing the total contribution margin we simply applied the above formula.
