Maurice Tutor

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Category > Accounting Posted 16 Aug 2017 My Price 6.00

Bonita Inn

E6-1 The Bonita Inn is trying to determine its break-even point. The inn has 75 rooms that are rented at $60 a night. Operating costs are as follows.

 

Salaries                     $8,800 per month

 

Utilities                       2,400 per month

 

Depreciation              1,500 per month

 

Maintenance                 800 per month

 

Maid service                      8 per room

 

Other costs                      37 per room

 

Instructions

 

(a)  Determine the inn’s break-even point in (1) number of rented rooms per month and

 

(2) dollars.

 

(b)  If the inn plans on renting an average of 50 rooms per day (assuming a 30-day month), what is (1) the monthly margin of safety in dollars and (2) the margin of safety ratio?

 

Answers

Maurice Tutor
(5)
Status NEW Posted 16 Aug 2017 06:08 PM My Price 6.00

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