Answer:
a. Contribution margin per passenger ($50-$20) = $30
b. Contribution margin ratio (30/50) = 60%
c. Operating Income (390000-270000) = $120,000
d. Operating Profit = $42,000
Explanation:
a. Contribution formula = Sale - Variable Cost
Sale price per passenger = $50
Variable Cost per passenger = $20
Contribution margin per passenger ($50-$20) = $30
b. Contribution Margin ratio formula = Contribution/Sale
Sales per passenger = 50
Contribution per passenger = 30
Contribution margin ratio (30/50) = 60%
c. Operating profit = Contribution margin- Fixed Cost
Monthly sale total for 13000 passenger
Sale per passenger = $50
Total sale for 13000 passenger 13000*50 = $650,000
Contribution Margin per passenger =$30
Total Contribution margin for 13000 passenger = 13000*30 = $390,000
Less: Fixed Cost = 270,000
Operating Income (390000-270000) = $120,000
d. Contribution margin formula= (Sale x Contribution margin ratio)
Contribution margin = (520000*60%) = $312,000
Less: Fixed Cost = 270,000
Operating Profit = $42,000
