Ex 11-2… question is attached…

Ex 11-2… question is attached…

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Exercise 11-22
Break-even sales and sales mix for a service company
Yellow Dove Airways provides air transportation services between Portland and Minneapolis. A single
Portland to Minneapolis round-trip flight has the following operating statistics:
Fuel and landing fees
$19,400
Flight crew salaries
3,760
Airplane depreciation
2,600
Variable cost per passenger- business class
50
Variable coper passenger- economy class
20
Round-trip ticket price- business class
750
Round-trip ticket price- economy class
300
It is assumed that the fuel and landing fees, crew salaries, and airplane depreciation are fixed, regardless of the
number of seats sold for the round-trip flight.
a.) Compute the break-even number of seats sold on a single round-trip flight for the overall product. Assume that
the overall product is 10% business class and 90% economy class tickets.
b.) How many business class and economy seats would be sold at the break even point?

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